As used in this part, the following terms shall have the meanings indicated below:

(a) The Act. "The Act" means the Foreign Assistance Act of 1961, as amended from time to time.

(b) A.I.D. "A.I.D." means the Agency for International Development or any successor agency, including, when applicable, each US AID.

(c) A.I.D. geographic code. “A.I.D. geographic code" means a code in the A.I.D. Geographic Code Book which designates a country, a group of countries, or an otherwise defined area. Principal A.I.D. geographic codes are described in § 201.11(b)(4) of this part.

(d) AID/W. “AID/W" means the A.I.D. in Washington, D.C. 20523, including any office thereof.

(e) Approved applicant. "Approved applicant" means the person or organization designated by the borrower/ grantee to establish credits with banks in favor of suppliers or to instruct banks to make payments to suppliers, and includes any agent acting on behalf of such approved applicant.

(f) Bank. "Bank" means a banking institution organized under the laws of the United States, or any State, territory, or possession thereof, or Puerto Rico or the District of Columbia.

entity to which A.I.D. directly makes funds available by loan or grant.

(h) Commodity. "Commodity" means any material, article, supply, goods, or equipment.

(i) Commodity-related services. "Commodity-related services" means delivery services and/or incidental services.

(j) Cooperating country. "Cooperating country" means the country receiving the A.I.D. assistance subject to provisions of this Part 201.

(k) Delivery. "Delivery" means the transfer to, or for the account of, an importer of the right to possession of a commodity, or the rendering to, or for the account of, an importer of any commodity-related service.

(1) Delivery services. “Delivery services" means any service customarily performed in a commercial export transaction which is necessary to effect a physical transfer of commodities to the cooperating country. Examples of such services are the following: Export packing, local drayage in the source country (including waiting time at the dock), ocean and other freight, loading, heavy lift, wharfage, tollage, switching, dumping and trimming, lighterage, insurance, commodity inspection services, and services of a freight forwarder. "Delivery services" may also include work and materials necessary to meet A.I.D. marking requirements.

(m) Implementing document. "Implementing document" means any document issued by A.I.D. which authorizes the use of A.I.D. funds for the procurement of commodities and/or commodity-related services and which specifies conditions which will apply to such procurement.

(n) Importer. "Importer” means any person or organization, governmenta! or otherwise, in the cooperating country who is authorized by the borrower/grantee to use A.I.D. funds under this Regulation for the procurement of commodities, and includes any borrower/grantee who undertakes such procurement.

maintenance, operation and use of such equipment.

(p) Purchase contract. "Purchase contract" means any contract or similar arrangement under which a supplier furnishes commodities and/or commodity-related services financed under this part.

(q) Source. "Source" means the country from which a commodity is shipped to the cooperating country, or the cooperating country if the commodity is located therein at the time of the purchase. Where, however, a commodity is shipped from a free port or bonded warehouse in the form in which

received therein, "source" means the country from which the commodity was shipped to the free port or bonded warehouse.

(r) Supplier. "Supplier" means any person or organization, governmental or otherwise, who furnishes commodities and/or commodity-related services financed under this Part 201.

(s) Supplier's Certificate. "Supplier's Certificate" means AID Form 282 (178) "Supplier's Certificate and Agreement with the Agency for International Development", including the "Invoice-and-Contract Abstract" on the reverse of such form (Appendix A to this Part 201), or any substitute form which may be prescribed in the letter of commitment, request for the opening of a special letter of credit, or other pertinent implementing document.

(t) United States. "United States" means the United States of America, any State, territory, or possession thereof, Puerto Rico and the District of Columbia.

(u) US AID. "US AID" means the A.I.D. mission or representative to any cooperating country.

(v) [Reserved]

(w) Commodity Approval Application. "Commodity Approval Application" means the Application for Approval by the Agency for International Development of Commodity Eligibility (A.I.D. Form 11) which appears as Appendix D to this Part 201.

(x) Schedule B. "Schedule B" means "Schedule B, Statistical Classification of Domestic and Foreign Commodities Exported from the United States" issued and amended from time to time

by the U.S. Bureau of the Census, Department of Commerce, and published in 15 CFR 30.92.

[A.I.D. Regulation 1, 36 FR 7096, Apr. 14, 1971, as amended at 37 FR 12792, June 29, 1972; 38 FR 13641, May 24, 1973; 38 FR 18016, July 6, 1973; 43 FR 25998, June 16, 1978; 45 FR 71798, Oct. 30, 1980]

§ 201.02 Scope and application.

The appropriate implementing document will indicate whether and the extent to which this Part 201 shall apply to the procurement of commodities or commodity-related services or both. Whenever this Part 201 is applicable, those terms and conditions of this part will govern which are in effect on the date of issuance of an irrevocable letter of credit under which payment is made or is to be made from funds made available under the Act or, if no such letter of credit has been issued, on the date payment instructions for payment from funds made available under the Act are received by the paying bank.

(a) The borrower/grantee is responsible for compliance with the applicable and suppliers and for assuring that importers and suppliers are informed of the extent to which this part applies.

(b) Subpart B sets forth conditions governing the eligibility for A.I.D. financing of transactions covering commodities and commodity-related services.

(c) Subpart C prescribes procedures which importers shall follow in purchasing commodities.

(d) Subpart D sets forth the responsibilities of suppliers.

(e) Subpart E contains provisions relating to:

(1) The diversion of shipments and the vesting in A.I.D. of title to commodities:

(2) The effect of termination or modification of any loan, grant or implementing document; and

(3) A.I.D. audit and inspection rights.

(f) Subpart F describes the financing process and prescribes the documents which shall be submitted to banks and to A.I.D.

(g) Subpart G contains the price tests which shall be met and limitations on amounts and types of payments which A.I.D. will finance.

(h) Subpart H defines the rights and responsibilities of banks.

(i) Subpart I sets out the rights and remedies which are reserved to A.I.D. and provides for the waiver under special circumstances of the provisions of this Part 201.

(j) Unless otherwise indicated, references in this Part 201 to subparts or to sections relate to subparts or sections of this Part 201.

[A.I.D. Reg. 1, 36 FR 7096, Apr. 14, 1971, as amended at 37 FR 12792, June 29, 1972]

§ 201.11 Eligibility of commodities.

To qualify for A.I.D. financing, a commodity procurement transaction shall satisfy the following requirements:

(a) Description and condition of the commodity. The commodity shall conform to the description in the implementing document. Unless otherwise authorized by AID/W in writing, the commodity shall be unused, and may not have been disposed of as surplus by any governmental agency.

(b) Source-(1) General rule. The source of the commodity shall be a country authorized in the implementing document by name or by reference to an A.I.D. geographic code. In addition, the commodity shall have been mined, grown, or through manufacturing, processing, or assembly produced in a source country authorized in the implementing document.

(2) Exceptions. A produced commodity will not be eligible for A.I.D. financing if:

(i) It contains any component from countries other than free world coun

tries as described in A.I.D. Geographic Code 935; or

(ii) It contains components which were imported into the country of production from such free world countries other than authorized source countries; and

(a) Such components were acquired by the producer in the form in which they were imported;

(b) The total cost of such components (delivered at the point of production) amounts to more than 50 percent, or such other percentage as A.I.D. may prescribe, of the lowest price (excluding the cost of ocean transportation and marine insurance) at which the supplier makes the commodity available for export sale (whether or not financed by A.I.D.)

(c) For the purpose of calculating eligible components under this paragraph (b)(2)(ii), "authorized source countries" shall include the cooperating country itself whenever AID has authorized procurement from a geographic code other than AID Geographic Code 000.

(3) Waiver provision. AID/W_may from time to time waive or modify the requirements of paragraph (b)(2)(ii) of this section in appropriate cases.

(4) Identification of principal geographic code numbers. The A.I.D. Geographic Code Book sets forth the official description of all geographic codes used by A.I.D. to designate the authorized source for procurement. Following are summaries of the principal codes:

Code 000-"The United States": The states of the United States, the District of Columbia, and areas of U.S. associated sovereignty, including the trust territories.

Code 899-"Free World": Any area or country, except the cooperating country itself and the following countries: Albania, Bulgaria, Cambodia, Cuba, Czechoslovakia, German Democratic Republic, Hungary, Laos, Mongolia, North Korea, People's Republic of China, Poland, Romania, Union of Soviet Socialist Republics (USSR), and Viet

nam.

Code 935-"Special Free World": Any area or country in the Free World, including the cooperating country.

Code 941-"Selected Free World": The United States and any independent country in the Free World, except the cooperating country itself and the following: Afghani