Proclamation 6120—Restoring the Country Allocation To Nicaragua For Quotas on Certain Sugars, Syrups and Molasses

1. Additional U.S. note 2 to chapter 17 of the Harmonized Tariff Schedule of the United States (HTS), enacted by section 1204(a) of the Omnibus Trade and Competitiveness Act of 1988 (Pub. L. No. 418, (a)), provides in relevant part as follows:

"2. The rates in column numbered 1 in subheadings 1701.11, 1701.12, 1701.91.20, 1701.99, 1702.90.30, 1702.90.40, 1806l.10.40 and 2106.90.10, on January 1, 1968, shall be effective only during such time as title II of the Sugar Act of 1948 or substantially equivalent legislation is in effect in the United States, whether or not the quotas, or any of them, authorized by such legislation, are being applied or are suspended: Provided,"

"(a) That if the President finds that a particular rate not lower than such January 1, 1968, rate, limited by a particular quota, may be established for any articles provided for in the above-mentioned subheadings, which will give due consideration to the interests in the United States sugar market of domestic producers and materially affected contracting parties to the General Agreement on Tariffs and Trade, he shall proclaim such particular rate and such quota limitation, . . ."

"(b) That any rate and quota limitation so established shall be modified if the President finds and proclaims that such modification is required or appropriate to give effect to the above considerations; . . . ."

Previously, Proclamation No. 3822 of December 16, 1967 (82 Stat. 1455), had added almost identical provisions to the former Tariff Schedules of the United States (TSUS) in order to carry out a provision in the trade agreement known as the Geneva (1967) Protocol of the General Agreement on Tariffs and Trade (GATT) (Note 1 of Unit A, Chapter 10, Part I of Schedule XX; 19 U.S.T., Part II, 1282).

2. The Sugar Act of 1948 expired on December 31, 1974, and it has not been replaced with substantially equivalent legislation. Proclamation No. 4334 of November 16, 1974 (39 FR 40739), established rates of duty, and an absolute import quota, for such sugars, sirups and molasses, to become effective on January 1, 1975. Proclamation No. 4334 further proclaimed such quantitative limitations in the form of headnote 3 to subpart A, part 10, schedule 1 of the TSUS. Subsequent proclamations have modified such rates of duty and quota limitations. The provisions of headnote 3 to subpart A, part 10, schedule 1 of the TSUS are now set forth in additional U.S. note 3 to chapter 17 of the HTS.

3. By Proclamation No. 4941 of May 5, 1982 the President modified the quantitative limitations on the importation of certain sugars, sirups and molasses established in headnote 3 to subpart A, part 10, schedule 1 of the TSUS, in conformity with headnote 2 to the same subpart, and provided for a country-by-country allocation of the total quota quantity established thereunder. The share allocated to Nicaragua was 2.1 percent of the total base quota, which generally corresponded to its average share of imports into the United States during the period from 1975 through 1981, excluding the years in which the largest and smallest volumes of imports were recorded.

4. By Proclamation No. 5104 of September 23, 1983 Nicaragua's share of the total base quota amount was reduced to 6,000 short tons for each quota period. The quantity removed from Nicaragua's allocation was redistributed to Honduras, El Salvador and Costa Rica. Proclamation No. 5104 added, at the end of paragraph (c)(i) of headnote 3, a new Note 2 that, as incorporated in the HTS, now provides as follows:

"NOTE 2: Beginning with the quota year beginning September 26, 1983, the quota allocations for Nicaragua, Costa Rica, El Salvador and Honduras will be as follows:

Nicaragua -- 5,443 metric tons, raw value;

El Salvador -- 2.6 percent of the total base quota amount permitted to be imported under paragraphs (a) and (b) of this headnote plus 18 percent of the difference between 2.1 percent of the total base quota amount and 5,443 metric tons, raw value;

Honduras -- 1 percent of the total base quota amount plus 52 percent of the difference between 2.1 percent of the total base quota amount and 5,443 metric tons, raw value;

Costa Rica -- 1.5 percent of the total base quota amount plus 30 percent of the difference between 2.1 percent of the total base quota amount and 5,443 metric tons, raw value."

5. On March 13, 1984, the GATT Council adopted a panel report that found that the reduction in the allocation to Nicaragua was inconsistent with the obligations of the United States under the GATT. The Council recommended that the United States allocate to Nicaragua a sugar import quota consistent with the criteria set forth in Article XIII:2 of the GATT. On May 1, 1985, the President imposed an embargo on trade with Nicaragua, by Executive Order No. 12513 under the authority of the International Emergency Economic Powers Act, et seq., and the National Emergencies Act, et seq. I terminated this embargo by Executive Order No. 12707 of March 13, 1990

6. I find that the modifications of the quantitative limitations that are hereinafter proclaimed give due consideration to the interests in the United States sugar market of domestic producers and materially affected contracting parties to the GATT, and are consistent with the provisions of section 1204(c)(2) of the Omnibus Trade and Competitiveness Act of 1988 (c)(2)).

7. Section 604 of the Trade Act of 1974 authorizes the President to embody in the HTS the substance of the provisions of that Act, and of other Acts affecting import treatment, and actions taken thereunder.

Now, Therefore, I, George Bush, President of the United States of America, acting under the authority vested in me by the Constitution and statutes of the United States, including but not limited to additional U.S. note 2 to chapter 17 of the HTS, do hereby proclaim that:

(1) Note 2 at the end of paragraph (c)(i) of additional U.S. note 3 to chapter 17 of the HTS is deleted from the HTS, effective as to sugars, syrups or molasses entered, or withdrawn from warehouse for consumption, on or after the date of signature of this proclamation.

(2) Notwithstanding paragraph (1), the quantities of sugars, syrups and molasses allocated to Costa Rica, El Salvador and Honduras during the current quota period shall not be less lthan 49,758.5 metric tons, raw value, 71,034.1 metric tons, raw value, and 47,490.4 metric tons, raw value, respectively.

(3) Proclamation No. 5104 of September 23, 1983, is hereby terminated.

In Witness Whereof, I have hereunto set my hand this twenty-fifth day of April, in the year of our Lord nineteen hundred and ninety, and of the Independence of the United States of America and two hundred and fourteenth.

GEORGE BUSH