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prietorship or any other entity however organized including charitable, educational, or other eleemosynary institutions, and the Federal Government including corporations, departments, Federal agencies, and other instrumentalities, or local government units Provided, That such entity or entities are located or doing business in the Commonwealth. The DOCA may, in regulations and forms issued in this part, treat as a firm: (a) A parent and the consolidated and unconsolidated entities (if any) which it directly or indirectly controls, (b) a parent and its consolidated entities, (c) an unconsolidated entity, or (d) any part of a firm.

“Importer” means any firm that owns at the first place of storage any petroleum brought into the Commonwealth and includes petroleum product brought into the Commonwealth from the mainland.

"Independent marketer" either a branded independent marketer or a non-branded independent marketer.

“LPG” means liquefied petroleum gas, and includes propane and butane, and propane/butane mixes, but not ethane.

“Middle distillate” means any derivatives of petroleum including kerosene, home heating oil, range oil, stove oil, and diesel fuel, which have a fifty (50) percent boiling point in the ASTM D-86 standard distillation test falling between 371° and 700° F. Products specifically excluded from this definition are kerosene-base and naphtha-base jet fuel, heavy fuel oils as defined in VV-F-815C or ASTM D-396, grades #4, 5, and 6, intermediate fuel oils (which are blends containing #6 oil), and all specialty items such as solvents, lubricants, waxes and process oil.

“Motor gasoline" means a mixture of volatile hydrocarbons, suitable for operation of an internal combustion engine, whose major components, are hydrocarbons with boiling points ranging from 140° to 390° F and whose source is distillation of petroleum and cracking, polymerization, and other chemical reactions by which the naturally occurring petroleum hydrocarbons are converted to those that have superior fuel properties.

"Nonbranded independent marketer" means a firm which is engaged in the marketing or distribution of refined petroleum products, but which:

(a) Is not a refiner;

(b) Is not a firm which controls, is controlled by, is under common control with, or is affiliated with a refiner (other than by means of a supply contract); and

(c) Is not a branded independent marketer.

“Petroleum product" means propane, butane, motor gasoline and middle distillate.

"Prime supplier” means any supplier which makes the first sale of a petroleum product in the Commonwealth. In the case of an imported petroleum product, the first sale is the sale by the importer.

“Propane” means the chemical C,H, in its commercial forms including propane-butane mixes and the propane and other mixtures in which propane constitutes greater than ten (10) percent of the mixture by weight.

"Propane-butane mix" means any mixture consisting exclusively of propane and butane which contains greater than ten (10) percent by weight.

“Purchaser” means a wholesale purchaser, an end-user, or both, but does not include an exporter.

"Refined petroleum product” means gasoline, kerosene, middle distillate (including number 2 fuel oil), LPG, refined lubricating oils, or diesel fuel.

Refiner" means those firms which own, operate or control the operations of one or more industrial plants, regardless of capacity, processing crude oil feedstock or refined petroleum products and manufacturing propane, butane, motor gasoline, middle distillate or residual fuel oil.

“Residual fuel oil” means the fuel oils commonly known as: (a) No. 4, No. 5 and No. 6 fuel oils; (b) Bunker C; (c) Navy Special Fuel Oil; (d) crude oil when burned directly as a fuel; and all other fuel oils which have a fifty (50) percent boiling point over 700° F in the ASTMD-86 standard distillation test.

"Retail sales outlet” means a site on which a supplier maintains an ongoing business of selling any petro

8 660.102 Supplier/purchaser relation

ships. (a) Supplier/wholesale purchaser relationship. Each supplier of a petroleum product shall supply all wholesale purchasers which purchased or obtained that petroleum product from that supplier during the base period as specified in the provisions of this part or as otherwise ordered by the DOCA.

(b) Changes in ownership or brand. The supplier/purchaser relationship required by this part shall not be altered by (1) changes in the ownership or right to possession of the real property on which a wholesale purchaser maintains its on-going business or end use; or (2) changes in the brand or franchise under which a wholesale purchaser-reseller maintains its ongoing business.

(c) New relationships. (1) Suppliers shall not supply new wholesale purchasers except in accordance with $ 660.105(d).

(2) New suppliers shall not supply wholesale purchasers end-users except in accordance with $ 660.103(d).

(d) Dual capacities. A supplier may also act in the capacity of a wholesale purchaser, an importer, an exporter, or an end-user. A wholesale purchaser may act in the capacity of both a wholesale purchaser-reseller and wholesale purchaser-consumer. A firm which is acting in one or more different capacities shall comply with the appropriate regulations governing each capacity in which it acts.

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leum product to end-users or wholesale purchaser-consumers.

"Set-aside volume" means with respect to a particular prime supplier, the amount calculated pursuant to $ 660.110(c)(1).

"Supplier" means any firm located or doing business in the Commonwealth, which presently, during the base period or during any period between the base period and the present supplies, sells, transfers or otherwise furnishes (as by consignment) any petroleum product to wholesale purchasers, end-users or exporters. Supplier includes but is not limited to refiner, importer, exporter, reseller, jobber, and retailer.

“Supply obligation" means supply obligation as defined in § 660.103(b)(2).

"Wholesale purchaser" wholesale purchaser-reseller (other than an exporter) or a wholesale purchaser-consumer, or both.

Wholesale purchaser-consumer" means any firm that is an ultimate consumer in the Commonwealth, which, as part of its normal business practices, purchased or obtained in any completed calendar year subsequent to 1971 more than 24,000 gallons of a petroleum product from a supplier and received delivery of that product into a storage tank substantially under the control of that firm at a fixed location in the Commonwealth.

“Wholesale purchaser-reseller” means any firm which purchases, receives through transfer, or otherwise obtains (as by consignment) a petroleum product and resells or otherwise transfers it to other purchasers in the Commonwealth without substantially changing its form.

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Subpart C—General Allocation Rules

8 660.101 Applicability.

This subpart applies to each petroleum product sold for use within the Commonwealth after 11:59 p.m., October 31, 1974, and to each firm which refines, imports, exports, purchases or sells petroleum products in the Commonwealth.

8 660.103 Supplier's method of allocation.

(a) General. (1) Subject to the prenotification provisions in subpart E, suppliers of petroleum products shall allocate all of their allocable supply in accordance with the provisions of this section. Each supplier shall determine its allocation fraction pursuant to the provisions of paragraph (b) of this section. Suppliers shall then allocate to purchasers in accordance with the provisions of paragraph (c) of this section. The method of allocation for new suppliers is specified in paragraph (d) of this section. Suppliers with allocation fractions less than one (1.0) must act in accordance with the provisions of paragraph (e) of this section while

suppliers with allocation fractions adjusted pursuant to $ 660.106, which equal to or greater than one (1.0) must were supplied by the supplier during act in accordance with the provisions the appropriate base period Provided, of paragraph (f) of this section. Sup- That the purchaser is still in business pliers, other than new suppliers, which or continues to use the product for the in a particular base period have no same purposes for which it was pursupplier/purchaser relationships must chased in the base period; (B) the act in accordance with the provisions amounts of adjusted base period volof paragraph (g) of this section.

umes of new wholesale purchasers (2) For purposes of defining a suppli- which are assigned to or accepted by er in this part, a firm shall mean the the supplier in accordance with the parent and the consolidated and un

provisions of $ 660.105; and (C) the consolidated entities (if any) which it

amount equal to its total sales to enddirectly or indirectly controls.

users during that base period. Base (b) Allocation fraction. Each suppli

period volume is defined below. er shall determine a single allocation

(ii) Base period use. Base period use fraction for each petroleum product

means base period volume or adjusted prior to making any allocation. A sup

base period volume as appropriate. A plier's allocation fraction for any allo

wholesale purchaser's base period cation period for a petroleum product

volume of a particular petroleum shall be equal to its allocable supply of

product is the volume of that petrothat product, which is defined in para

leum product purchased or obtained graph (b)(1) of this section, for that

during the appropriate base period as period divided by its supply obligation

determined in accordance with for all levels of distribution, which is

$ 660.105(c) or the base period volume defined in paragraph (b)(2) of this sec

as adjusted pursuant to § 660.106. Base tion. (1) Allocable supply. Each supplier's

period volume, however, does not inallocable supply of a petroleum prod

clude amounts of a petroleum product uct for an allocation period shall be

obtained pursuant to in kind exchange equal to its total supply for that

agreements involving a single product

which are normal business operating period, which is the sum of its estimated production, including amounts re

procedures except the difference be

tween the total amounts received ceived under processing and exchange agreements, imports, purchases and

under exchange agreements and the any reduction in inventory of that pe

total amounts supplied to customers troleum product made pursuant to

through exchange agreements. In the § 660.9 except as otherwise ordered by

case of a new wholesale purchaser, DOCA; less (i) any amounts designat

base period volume means the volume ed as set-aside pursuant to § 660.110;

assigned or agreed to pursuant to

$ 660.105(d). (ii) any amount supplied to customers

Adjustments base through exchange agreements; and

period volumes shall be made in ac

cordance with the (iii) any amount in excess of the

provisions of amount sold for use within the Com

$ 660.106. monwealth of Puerto Rico in the 1973

(c) Allocation by suppliers to wholeperiod corresponding to the allocation

sale purchasers and end-users-(1) period unless otherwise ordered by the

Wholesale purchasers. A supplier shall DOCA pursuant to § 660.9. Any exist

allocate to each of its wholesale puring inventory, production, importation chasers a volume of a petroleum prodor purchase of a petroleum product uct equal to the product of that supused to increase that inventory con- plier's allocation fraction multiplied sistent with the provisions of $ 660.9 by an amount equal to that wholesale shall not be included in the allocable purchaser's base period use. supply of that product.

(2) End-users. Suppliers shall allo(2) Supply obligation—(i) General. A cate equitably among end-users, supplier's supply obligation of a par- volume of petroleum product equal to ticular petroleum product is the sum the product of that supplier's allocaof (A) the amounts of its wholesale tion fraction multiplied by an amount purchasers' base period volumes, as equal to its total sales to end-users in

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the appropriate base period or adjusted base period.

(d) New supplier. (1) A supplier which was not a base period supplier but was a supplier prior to January 15, 1974 shall supply in accordance with the provisions of this section, (i) wholesale purchasers which it supplied as of January 15, 1974 and which have no base period supplier; (ii) any purchasers assigned by DOCA; (iii) new wholesale purchasers acquired after January 15, 1974 in accordance with the provisions of $ 660.105; and (iv) to the maximum extent possible, end-users.

(2) A supplier which was not a supplier prior to January 15, 1974 shall be considered to have no supply obligation and shall not allocate supplies to any purchaser without DOCA approval.

(3) Notwithstanding any other provisions of paragraph (d) of this section, a supplier which was not a base period supplier but which is a supplier on October 31, 1974 shall for the allocation periods which includes the months of November and December, supply the wholesale purchasers assigned by the DOE prior to October 31, 1974.

(e) Allocation fractions less than one. (1) When a supplier's allocation fraction is less than one (1.0), a supplier shall reduce, on a pro rata basis, the amounts supplied to end-users and wholesale purchasers.

(2) Subject to the requirements of paragraph (c)(2) of this section, any supplier whose allocation fraction is less than one (1.0) and whose wholesale purchasers either have not purchased or have notified the supplier of their intent not to purchase the volume of petroleum product calculated pursuant to paragraph (c)(1) of this section by the end of the current allocation period may report and dispose of such volumes in accordance with the provisions of paragraph (f)(2)(i) of this section.

(f) Allocation fractions equal to or greater than one. (1) In allocating allocable supplies of any petroleum product among wholesale purchasers and end-users no supplier may use an allocation fraction greater than one (1.0). If a supplier's allocable supply is of sufficient magnitude that the alloca

tion fraction exceeds one (1.0), the supplier shall make allocations based on an allocation fraction of one (1.0), and shall comply with the provisions of paragraph (f)(2) of this section.

(2) (i) Each prime supplier and each supplier of unleaded gasoline shall report the volume of surplus petroleum product remaining in allocable supply to the DOCA in accordance with the provisions of $$ 660.152 and 660.153. The DOCA may direct that the petroleum product be distributed among other suppliers, sold to designated wholesale purchasers or endusers, be distributed to the reporting supplier's purchasers on a pro rate basis, be accumulated in inventory, or be added to the supplier's set-aside volume. If the reporting supplier is not notified to the contrary by the DOCA within fifteen (15) days after filing of its report with the DOCA, he may distribute these volumes at his discretion; provided however, that the supplier maintains adequate records to allow DOCA, upon request, to ascertain the disposition of the surplus product.

(ii) A supplier (other than a prime supplier or a supplier of unleaded gasoline) may distribute its surplus petroleum product remaining in allocable supply at its discretion.

(3) Notwithstanding the provisions of paragraphs (e)(2) or (f)(2) of this section, no supplier shall supply and no end-user or wholesale purchaserconsumer shall accept quantities of a petroleum product which exceed one hundred (100) percent of that end-user or wholesale purchaser-consumer's current requirements, unless directed by DOCA.

(g) Suppliers without wholesale purchasers or end-users. A supplier such as an exporter which was in existence prior to January 15, 1974 but which in a particular base period has no supplier/purchaser relationships established pursuant to § 660.102, shall report its total supply to the DOCA pursuant to the provisions of $ 660.153(a). Unless the supplier is notified by the DOCA to make directed sales pursuant to § 660.9, the suppliers shall allocate its petroleum products pursuant to the DOE regulations.

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8 660.104 Basis for purchaser's entitlement

to allocation. (a) Basis of entitlement. A wholesale purchaser shall receive an allocation based on its conduct of an on-going business in the Commonwealth maintenance of an established end-use within the Commonwealth.

(b) End-users and wholesale purchasers as a firm. (1) For purposes of defining a wholesale purchaser-consumer in this part, a firm shall mean those parts of the parent and the consolidated and unconsolidated entities (if any) which it directly or indirectly controls which act as ultimate consumers in the Commonwealth including all sites, storage tanks and other facilities or entities of the wholesale purchaser-consumer that utilize store a petroleum product in the Commonwealth.

(2) Except as provided in paragraph (b)(3) of this section, for purposes of defining wholesale purchaser-reseller in this part, a firm shall mean all those parts of the parent and the consolidated and unconsolidated entities (if any) which it directly or indi. rectly controls which sell petroleum products in the Commonwealth.

(3) Each firm or part of a firm which operates an on-going business of selling motor gasoline at a retail sales outlet shall be considered a separate firm with respect to each such outlet, and therefore shall be a separate wholesale purchaser-reseller. The entity which merely holds a real property interest in a retail sales outlet on which another entity operates an ongoing business shall not be considered the wholesale purchaser-reseller with respect to that outlet.

(c) Loss of allocation entitlement for going out of business_(1) General. Wholesale purchasers which have gone out of business shall not be eligible for allocations based on volumes received or purchases made prior to going out of business.

(d) Retail sales outlets for gasoline. For purposes of this paragraph (c) a wholesale purchaser-reseller which operates a retail sales outlet shall be deemed to have gone out of business with respect to that outlet if it vacates the site on which it conducts such business. Notwithstanding the forego

ing, an independent marketer shall not be deemed to have gone out of business if (i) the independent marketer vacates the site on which it formerly operated a retail sales outlet; (ii) the former site is closed as a retail sales outlet or is operated as such by a firm that is not an independent marketer; and (iii) the independent marketer that occupied the former site, within a reasonable time, as determined by the DOCA, re-establishes another retail sales outlet at another location serving substantially the same customers or market that was served by the former site.

(e) Transfer of entitlement-(1) General. The right to receive an allocation shall not be assignable separately but shall be considered an integral part of the on-going business or established end-use. The right to an allocation shall be deemed to have been transferred only when the entire business or activity of the firm is transferred to a successor firm.

(2) Retail sales outlets for gasoline. For purposes of this paragraph (d), whenever a wholesale purchaser-reseller is deemed to have gone out of business in accordance with paragraph (c)(2) of this section, the right to an allocation with respect to the retail sales outlet shall be deemed to have been transferred to its successor in the site, provided such successor establishes the same ongoing business on the site within a reasonable period of time, as determined by the DOCA, after its predecessor vacates the premises.

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8 660.105 Purchaser's allocation entitle

ment. (a) Scope. This section describes a purchaser's allocation entitlements. Paragraph (b) of this section specifies the volumes of a petroleum product which wholesale purchasers are entitled to receive from suppliers. The method by which wholesale purchasers determine base period volumes is provided in paragraph (c) of this section. Paragraphs (d) and (e) of this section set forth procedures by which new wholesale purchasers and new importer-consumers, respectively determine their entitlements and suppliers.

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