(c) Foreign purchase program.—Under its foreign purchase program the Corporation purchases abroad such foods, agricultural commodities and products thereof, and related facilities as are needed to meet both foreign and domestic requirements. These purchases have consisted largely of commodities in short supply, notably fats and oils, sugar, cocoa beans, long-staple cotton, protein meals, tea, and rice. Most of the purchases have implemented the allocations of agricultural commodities in short world supply made by the International Emergency Food Committee. The President of the United States, on April 28, 1942, approved "the use by the Commodity Credit Corporation of any of its funds for the purpose of carrying out projects involving the acquisition, handling, and disposition of agricultural commodities produced in foreign countries friendly to the United States." On May 16, 1942, the Board of Economic Warfare, which had general jurisdiction over foreign economic matters, designated the Corporation, with certain exceptions, as the sole and exclusive agency for the purchase of agricultural commodities in foreign countries. The foreign purchase program of the Corporation, with the exception of purchases of sugar in Cuba and purchases of commodities in Canada, was transferred to the Foreign Economic Administration by Executive Order No. 9385 (8 F. R. 13783) dated October 6, 1943. The program was ordered returned to the Department of Agriculture by Executive Order No. 9630 (10 F. R. 12245), dated September 27, 1945.

(d) Commodity export program.-Under its commodity export program the Corporation exports or causes to be exported agricultural commodities and products. The purpose of the program is to retain foreign markets for agricultural commodities and products thereof produced in the United States and to aid in the disposal of surplus agricultural commodities.

Disposals of agricultural commodities and products thereof for export are made at competitive world prices, which are below domestic market prices, pursuant to section 21 (c) of the Surplus Property Act of 1944 (50 U. S. C. App., 1940 ed., Supp. V, 1630 (c)). That section authorizes the Corporation to dispose or cause to be disposed of for cash or its equivalent in goods or for adequately secured credit for export only, and at competitive world prices any farm commodity or product thereof without regard to restrictions with respect to the disposal of commodities imposed upon the Corporation by any law. No food or food product, however, may be disposed of, if such food or food product is in short supply or its disposition would create a short supply. Disposals under this authority result in a loss to the Corporation. Prior to the enactment of section 21 (c) the Corporation's ability to engage in export operations was substantially limited by the statutory prohibition against sales of farm commodities below the parity or comparable price.

(e) Loan program for agricultural conservation purposes.-Section 391 (c) of the Agricultural Adjustment Act of 1938, as amended (7 U. S. C., 1940 ed., 1391), requires the Corporation to loan to the Secretary of Agriculture during each fiscal year such sums, not to exceed $50,000,000, as the Secretary estimates will be required during such fiscal year to make advances pursuant to the applicable provisions of sections 8 and 12 of the Soil Conservation and Domestic Allotment Act, as amended. These loans have been used to purchase conservation materials during the period from January 1 to June 30 of each year. Repayment of any such loan is directed to be made during the succeeding fiscal year from funds appropriated to carry out sections 7 to 17 of such act, with interest at a rate determined by the Secretary, but not less than the cost of money to the Corporation.

Activities of the Corporation under a subsidy program, which during the war years was a major activity of the Corporation, are currently limited to its liquidation. The subsidy operations of the Corporation, with the exception of sugar and peanut subsidies, were terminated on or before June 30, 1946, and were in liquidation beginning with that date; the subsidy on peanuts was terminated early in the fiscal year 1947, and sugar subsidies were terminated when price ceilings were removed effective November 1, 1947.

In addition to the programs carried out by the Corporation, the Secretary of Agriculture, under the authority of the act of July 30, 1947 (60 Stat. 610), has determined that Corporation funds should be transferred under the provisions of that act to the appropriation for the eradication of foot-and-mouth and other contagious diseases of animals. Proceeds from sales of canned meat procured in Mexico with funds so transferred are applied by the Corporation as a credit against the transfers made.

PART II. SECTION-BY-SECTION ANALYSIS OF PROPOSED LEGISLATION 1 Section 1 provides that the act may be cited as the "Commodity Credit Corporation Charter Act."

Section 2 creates the Corporation as an agency and instrumentality of the United States within the Department of Agriculture under the general direction and control of the Secretary of Agriculture. This is consistent with its present status. The purposes for which the Corporation is organized are stated to be the stabilization, support, and protection of farm income and prices; the maintenance of balanced and adequate supplies of agricultural commodities, products thereof, foods, feeds, and fibers; and the facilitation of the orderly distribution of agricultural commodities, products thereof, foods, feeds, and fibers. These purposes are substantially the same as those which the Delaware corporation has served during the past.

Section 3 permits the Corporation to establish offices in any place or places it deems necessary or desirable in the conduct of its business. The principal office of the Corporation is presently located in the District of Columbia. Inasmuch as the operation of the Corporation, particularly those pertaining to price support, must be conducted throughout the United States, the authority to esablish offices in the field is essential to the effective conduct of the Corporation's business.

Secion 4 grants to the Corporation certain general powers, both procedural and substantive, necessary or appropriate to the corporate form of organization and to the carrying out of the specific powers granted the Corporation by section 5. Subsections (a) and (b) provide, respectively, for corporate succession and use of a corporate seal.

Subsection (c) provides for suability and imposes certain limitations and restrictions upon the general right to sue and be sued. It is provided that no attachment, injunction, garnishment, or similar process may be issued, either prior to or after final judgment, against the Corporation or its property. The provision is like that contained in the act creating the Federal Crop Insurance Corporation (7 U. S. C., 1940 ed., 1506). The availability of any of these judicial processes would not afford to creditors or other persons suing the Corporation any benefit which would outweigh the possible detriment to the Government through hindrance or obstruction of the Corporation's operations, if it were made amenable to such processes. The designation of the United States district courts to have exclusive original jurisdiction of all suits in which the Corporation is involved, rather than permitting the use of State forums, is desirable because the Corporation is a Federal agency, and, generally speaking, the questions litigated will be questions of Federal law. In view of the liberal venue provisions of this subsection, no hardship will be caused any plaintiff by limiting original jurisdiction to the Federal district courts. The right of the Corporation to intervene in suits, actions, or proceedings in any other court is preserved, however, in order that it might adequately protect its interests in other suits, actions, or proceedings, such as probate proceedings in county courts, foreclosure proceedings against property on which the Corporation may have a lien, and other similar proceedings. The venue of suits against the Corporation is established in the District of Columbia, or in the district in which the plaintiff resides or is engaged in business. The 2-year limitation upon the right to bring suit against the Corporation represents a length of time believed fair to both the plaintiff and the Corporation. In this connection, it is to be noted that the Federal Tort Claims Act recently passed by the Congress (60 Stat. 842) contains a 1-year statute of limitations. It is felt with respect to the Corporation that allowance of a greater length of time than 2 years is not required where a bona fide claim exists, and would present unnecessary difficulties in the way of obtaining witnesses and records on behalf of the Corporation. The provision requiring all suits against the Corporation to be tried by the court without a jury is similar to the procedure followed in the Court of Claims and in the Federal district courts in claims against the United States authorized by the Tucker Act and the Federal Tort Claims Act, which are the statutes giving general jurisdiction to the Federal Courts in claims against the United States. Since the Federal Tort Claims Act is designed for uniform application to all Government agencies, including corporations, the applicability of the act to the Corporation is preserved. Consequently, there would be a 1-year statute of limitations applicable to claims cognizable under that act.

Subsection (d) grants to the Corporation the power to adopt, amend, and repeal bylaws, and other rules and regulations, governing the manner in which its business may be conducted and the powers vested in it may be exercised.

1 Analysis does not include committee amendments.

Subsection (e) provides that the Corporation shall have the rights, privileges, and immunities of the United States and may assert them in any suit, action, or proceeding. Since the Corporation is an agency of the United States which, in the final instance, will bear any losses suffered by the Corporation, it is desirable that the Corporation be clothed with the rights, privileges, and immunities of the sovereign. The section enumerates, but not by way of limitation, certain of the rights, priorities, and immunities of the United States which would, by virtue of this section, be enjoyed by the Corporation. The enumerated limitations are, generally speaking, those which, by decision of the Supreme Court, are not presently enjoyed by the Corporation; for example, immunity from imposition of court costs, fees, and charges, and exemption from allowance of interest on claims and judgments; and those as to which the question of applicability has not been determined by the Supreme Court, such as the applicability of State and local statutes of limitations to Government corporations.

Subsection (f) is the customary provision granting corporate agencies of the United States the right to use the mails upon the same conditions as those governing their use by the executive departments.

The first sentence of subsection (g) grants to the Corporation the essential power to enter into and carry out such contracts or agreements as are necessary or desirable for the conduct of its business. The second sentence of subsection (g) grants to the Corporation the power to modify a contract or agreement to which it is a party when such modification is deemed necessary or desirable to further its objects and purposes, even though such modification may, technically, be without consideration. Subsection (g) further provides that State and local regulatory laws or rules shall not be applicable with respect to contracts or agreements of the Corporation or the parties thereto to the extent that such contracts or agreements provide that such laws or rules shall not be applicable, or to the extent that such laws or rules are inconsistent with such contracts or agreements. This provision will facilitate the use by the Corporation, in the carrying out of its Nation-wide programs, of standardized procedures and agreements, such as the use of storage agreements in which a uniform rate is specified, without regard to the varying rates prescribed by statute in numerous States. This provision will also enable the Corporation to give assurance to its contractors that in performing their contracts with the Corporation they will not be held in violation of such State and local regulatory laws.

Subsection (h) gives the Corporation the essential power to acquire, hold, and dispose of such real and personal property, or any interest therein, as it deems necessary or desirable in the conduct of its business.

Subsection (i) generally grants the power to borrow money subject to any provision of law applicable to the Corporation. Thus, the borrowing operations of the Corporation would be governed by section 4 of the act of March 8, 1938, as amended (15 U. S. C., 1940 ed., Sup. V, 713a-4), which defines the amount, the manner, and the terms and conditions of the Corporation's borrowing.

Subsection (j) grants the Corporation the authority, essential to the effective conduct of its business as a corporate entity, to determine the character of and the necessity for its obligations and expenditures and the manner in which they shall be incurred, allowed, and paid. This is a common provision of Federal corporate charters. (See the Federal Crop Insurance Act (7 U. S. C., 1940 ed., 1506); the Reconstruction Finance Corporation Act (15 U. S. C., 1940 ed., 604); the Federal Savings and Loan Insurance Corporation Act (12 U. S. C., 1940 ed., 1725); and the Federal Farm Mortgage Corporation Act (12 U. S. C., 1940 ed., 1020).) The Corporation, of course, will be subject to a commercial type of audit by the General Accounting Office under the provisions of the Government Corporation Control Act (31 U. S. C., 1940 ed., Sup. V, 850).

Subsection (k) explicitly vests in the Corporation the authority, implicit in subsection (j), to make final and conclusive settlement and adjustment of claims by or against the Corporation or the accounts of its fiscal officers. The power has been exercised by the Commodity Credit Corporation since its creation, and the power and its exercise were recognized by the Congress in the act of February 28, 1944 (15 U. S. C., 1940 ed., Sup. V, 713), in which it was provided that the Corporation should "continue" to have authority to make adjustment and settlement of its claims or the accounts of its fiscal officers. It was stated by the Congress in connection with the provisions of that act, that "the Commodity Credit Corporation's fiscal responsibility is vested in the Corporation alone and not in the individual fiscal agents. In other words, the fiscal agents are responsible to the Corporation; which in turn is liable to the Federal Government for the Government's investment in the Corporation. The examination of the individual accounts of particular fiscal agents with a view to external control and settlement would not facilitate a determination of the financial standing or progress of the

Corporation as a whole. Such an examination would, as a matter of fact, seriously interfere with the Corporation's internal financial management and impair the flexibility which is the very basis of the Corporation's existence" (S. Rept. 631, 78th Cong.; H. Rept. 846, 78th Cong.). A corporation such as the Commodity Credit Corporation, engaged in a multitude of commercial transactions, must be able expeditiously to adjust, compromise, and settle its claims in order efficiently to conduct its business.

Subsection (1) gives the Corporation authority to make such loans and advances of its funds as it deems necessary or desirable in the conduct of its business. Subsection (m) grants authority to the Corporation to conduct researches, surveys, and investigations relating to the conduct of its business.

Subsection (n) is the customary expression of the authority impliedly vested in corporations generally to exercise such powers as may be necessary or appropriate to the enjoyment of the powers expressly vested in the corporation and fairly incident to carrying them cut, or which may be incident to the existence of the corporation as a legal entity.

Section 5 sets forth the specific powers which the Corporation may exercise, and provides that such powers may be used only in fulfilling its purposes and in carrying out the annual budget programs submitted by the Corporation to and approved by the Congress pursuant to the Government Corporation Control Act (31 U. S. C., 1940 ed., Sup. V, 847). The powers specified are based upon a consideration of the past operations of the Commodity Credit Corporation, the operations of the Corporation provided for in the 1948 budget program approved by the Congress and the 1949 budget program submitted to the Congress, and the operations which the Corporation might be called upon to carry out during the postwar period and in periods of emergency. Although the powers will be broad, their exercise is limited by the requirement that they be carried out in accordance with annual budget programs, which require detailed justification, and review by continue in effect all statutory limitations now applicable to the operations of the and approval of the Congress each year. In addition, section 6 of this bill would Delaware corporation. It is believed that there should be available to American agriculture an agency with the flexible authority vested in the Corporation by this section 5.

Subsection (a) authorizes the Corporation to support the prices of agricultural commodities through loans, purchases, payments, and other operations. The Commodity Credit Corporation's principal function has been to stabilize, support, and protect farm income and prices through its price-support operations. This subsection does not supersede present legislation directing or authorizing price support, such legislation being expressly preserved by section 6 of this bill.

Subsection (b) authorizes the Corporation to make available materials and facilities required in connection with the production and marketing of agricultural commodities. This authority will enable the Corporation to carry out such operations as procuring or aiding in the procurement of feed, seeds, grain bins, and other storage facilities, bagging, fertilizers, and insecticides. Operations of this character have been carried out in the past under the Corporation's general charter authority.

Subsection (c) authorizes the Corporation to procure agricultural commodities for sale to other Government agencies, foreign governments, and domestic, foreign, or international relief or rehabilitation agencies, and to meet domestic requirements. Such operations of the Commodity Credit Corporation in the past include the procurement of agricultural commodities for the Army, the Navy, and the State Department, for cash-paying foreign governments, for the American Red Cross, Lend-Lease, and the United Nations Relief and Rehabilitation Administration. This authority will, when it is essential that Government procurement be undertaken in order to obtain adequate supplies, enable such procurement to be centralized in one Government agency, thereby not only making possible increased efficiency, but also enabling procurement operations to be carried out for the maximum benefit of American agriculture by coordinating procurement operations with price-support operations.

Subsection (d) authorizes the Corporation to remove and dispose of or aid in the removal or disposition of surplus agricultural commodities. In view of the possibility that American agriculture may be faced with surplus production during the postwar period, it is essential that the Corporation be empowered to deal effectively with such surpluses should they develop.

Subsection (e) grants authority to the Corporation to increase the domestic consumption of agricultural commodities by expanding or aiding in the expansion of domestic markets or by developing or aiding in the development of new and additional markets, marketing facilities, and uses for such commodities. Any

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program designed to protect agricultural prices and income and to avoid the production of unmanageable surpluses must necessarily include operations designed to expand existing markets and uses, to create new and additional markets and uses, and to promote orderly marketing by developing adequate marketing facilities.

Subsection (f) authorizes the Corporation to export or cause to be exported, or aid in the development of foreign markets for, agricultural commodities. It is essential to the agricultural economy of the United States that it maintain and expand its markets abroad for agricultural commodities. This subsection empowers the Corporation to carry out operations to this end.

Subsection (g) authorizes the Corporation, to the extent specifically authorized by law, to make payments with respect to, or purchases for resale at a loss of, agricultural commodities, for the purpose of maintaining the maximum prices established under the Emergency Price Control Act of 1942, as amended. Since the Emergency Price Control Act of 1942, as amended, has expired, it is recommended that this subsection be deleted from the bill.

Subsection (h) authorizes the Corporation generally to carry out such other operations as the Congress may authorize it to carry out or otherwise provide for.

Section 6 provides that the Federal statutes now applicable to the Delaware corporation shall be applicable to the Federal Corporation, except that the Delaware corporation shall cease to be an agency of the United States as provided in section 7 (a) of the act of January 31, 1935, as amended (15 U. S. C., 1940 ed., Sup. V, 713 (a)). The principal statutes thus made applicable are those (1) requiring an appraisal of the assets and liabilities of Commodity Credit Corporation as of June 30 of each year by the Secretary of the Treasury, authorizing an appropriation for the restoration of any impairment in the capital of the Corporation and requiring the payment to the United States Treasury of any amount by which its net worth exceeds its capitalization (15 U. S. C., 1940 ed., Sup. V, 713a-1, 713a-2); (2) authorizing the Corporation to borrow not to exceed $4,750,000,000, with the approval of the Secretary of the Treasury, upon the guaranty of the Treasury (15 U. S. C., 1940 ed., Sup. V, 713a-4); (3) exempting from taxation the obligations of the Corporation and its franchise, capital, reserves, surplus, income, and personal property (15 U. S. C., 1940 ed., 713a-5); (4) authorizing the Federal Reserve banks to act as fiscal agents and custodians for the Corporation (12 U. S. C., 1940 ed., Sup. V, 395); (5) requiring a commercial audit by the General Accounting Office of the accounts of the Corporation (15 U. S. C., 1940 ed., Sup. V, 713; 31 U. S. C., 1940 ed., Sup. V, 850); (6) requiring the submission to the Congress of annual budget programs (31 U. S. C., 1940 ed., Sup. V, 847); (7) authorizing the Commodity Credit Corporation to make available nonrecourse loans on agricultural commodities (including dairy products) (7 U. S. C., 1940 ed., 1302; 7 U. S. C., 1940 ed., Sup. V, 1359); (8) directing loans upon 1948 crops of the basic commodities at 90 percent of parity (921⁄2 percent in the case of cotton) (50 U. S. C. App., 1940 ed., Sup. V, 968); (9) requiring the Corporation to provide price support through loans, purchases, or other operations for producers of certain nonbasic (Steagall) commodities at not less than 90 percent of the parity or comparable price (15 U. S. C., 1940 ed., Sup. V, 713a-8 (a)); (10) declaring it to be the policy of Congress to support prices of nonbasic, nonSteagall commodities (15 U. S. C., 1940 ed., Sup. V, 713a-8 (b)); (11) authorizing and directing the Corporation to make loans to the Secretary of Agriculture to enable him to make advances pursuant to the Soil Conservation and Domestic Allotment Act (7 U. S. C., 1940 ed., 1391); (12) restricting the sale of farm commodities by the Corporation at less than parity or comparable price, with certain exceptions (7 U. S. C., 1940 ed., Sup. V, 1381n); (13) limiting the disposition of cotton by the Corporation (7 U. S. C., 1940 ed., 1381 (c)); (14) permitting the Corporation to dispose of or cause to be disposed of any farm commodity or product thereof, for export only, at competitive world prices (50 U. S. C. App., 1940 ed., Sup. V, 1630); (15) requiring reimbursement for services performed, losses sustained, and costs incurred on behalf of another Government agency (15 U. S. C., 1940 ed., Sup. V, 713a-9); (16) directing the payment to the Corporation of $500,000,000 as a reserve fund for expenditure, as and when necessary, for the postwar price support of agriculture (59 Stat. 429; 60 Stat. 6); (17) directing the Corporation to continue support price of wool at 1946 support levels until December 31, 1948 (61 Stat. 769); (18) providing for the utilization of price-support commodities in furnishing assistance and relief to foreign countries under the Foreign Aid Act of 1947 and other