§ 201.24 Solicitation of bids and quotations.

(a) Notification requirements. Except as paragraph (b) or (c) of this section may apply, the importer shall comply with the minimum notification requirements set forth in this paragraph (a). He may take such additional steps to notify prospective suppliers as are consistent with prudent procurement.

(1) Under formal competitive bid procedures. Invitations for bids must be advertised in the following manner:

(i) Submission to A.I.D. Three copies of the invitation for bids must be sent to the Office of Small Business, A.I.D., Washington, D.C. 20523, and 50 copies of the invitation shall be sent to a place in the United States designated by the borrower/grantee and agreed to by A.I.D. Invitations must be available to prospective suppliers free of charge, unless otherwise authorized by the Office of Small Business AID/W. All copies must be accompanied by a complete set of any additional drawings, details, applicable Government regulations, and other pertinent data necessary to the preparation of bids, or make reference to such additional documents as are readily available to the public or are available for public inspection.

(ii) Time of submission. Copies of the invitation for bids must be furnished sufficiently in advance of the bid-closing date to permit adequate preparation of bids. Unless a longer period is prescribed by the Office of Small Business, AID/W, or upon application of the importer a lesser period is authorized by such Office, the required copies shall be sent so as to arrive in the Office of Small Business, AID/W, at least 45 days in advance of the bid-closing date.

(2) Under other procurement procedures. In procurement other than by formal competitive bids, the solicitation of quotations and offers must include the following: The importer shall submit, in triplicate, to the Office of Small Business, A.I.D., Washington, D.C. 20523, a notice of proposed procurement, which shall include commodity specifications in terms of U.S. standards, and other procurement data, in the English language and in the format set out in "Instructions for Notice of Proposed Procurement" (Appendix B to this Part 201). No importer, importer's agent or representative, or anyone acting in his behalf,

shall accept any offer or place any order or agree to accept any offer or place any order until 45 days after the expected arrival of such form at the Office of Small Business, AID/W, in the course of mail. The Office of Small Business may require a longer period or, upon application of the importer, authorize a lesser period.

(3) Resubmission of notifications to A.I.D. A.I.D. may require the revision and resubmission to A.I.D. of any invitation for bids which does not comply with the requirements of § 201.22 (a) or of subparagraph (1) of this paragraph or of any notice of proposed procurement which does not comply with the requirements of subparagraph (2) of this paragraph. In such cases the importer shall effect changes necessary to assure compliance with the applicable requirements. The bid-closing date or the date before which an order may not be placed or accepted will be extended as A.I.D. (Office of Small Business) may instruct. A.I.D. (Office of Small Business) may, when it determines it necessary, return to the importer for revision or resubmission the invitation for bids or the notice of proposed procurement. In such cases the revised invitation or notice must be resubmitted in accordance with all the requirements of this paragraph for original submission to A.I.D.

(b) Exemption for small value procurement. Any commodity procurement undertaken by an importer under a single import license or other authority where the estimated landed cost of all purchases made by him under a single three-digit A.I.D. commodity code is less than $5,000 is exempted from the notification requirements of paragraph (a) of this section. This exemption does not apply to procurement undertaken in amounts of less than $5,000 for the purpose, or with the effect, of evading the requirements of paragraph (a) of this section.

(c) Waiver provisions. A.I.D. may waive any notification requirement in the following situations:

(1) Procurement under certain special supplier-importer relationships. (i) A supplier may apply for a waiver for the benefit of a named importer if

(a) The procurement concerns a registered brand name commodity

(1) Which is for resale by the importer;

(2) For which the importer is a regularly authorized distributor or dealer of the supplier; and

(3) For which the supplier is the sole distributor; or

(b) The procurement concerns a commodity

(1) Which is for resale by the importer; (2) For which the importer is a regularly authorized distributor or dealer of the supplier; and

(3) For which the supplier is the manufacturer or the manufacturer's regularly authorized exporter for the destination involved; or

(c) The procurement concerns a commodity

(1) Which is procured for manufacture, processing or assembly, and resale of the end-product by the importer;

(2) For which the importer is a regularly authorized distributor or dealer of the supplier; and

(3) For which the supplier is the manufacturer or the manufacturer's regularly authorized exporter for the destination involved; or

(d) The commodity is procured under such other commercial relationship which appears to A.I.D. to merit a waiver from the notification requirements.

(ii) Applications for waiver shall be sent by the supplier to the Office of Small Business, A.I.D., Washington, D.C. 20523, and shall include the following:

(a) The name and address of the importer who serves as the authorized distributor or dealer;

(b) The specific commodities covered by the supplier-importer agreement;

(c) Certification concerning the nature and duration of the commercial relationship between the supplier and the importer, supported by a copy or abstract of the pertinent provisions of any underlying written agreement between the supplier and the importer; and

(d) If the supplier is not the manufacturer of the commodity, a statement containing the pertinent provisions of any underlying agreement between the supplier and the manufacturer.

(iii) The waiver, if granted, will be forwarded in duplicate to the supplier. The supplier is responsible for forwarding one copy of the waiver to the importer and for advising the Office of Small Business, AID/W, of any change in his agreement with the importer which may affect the waiver granted by A.I.D.

(ii) Application for waivers shall be made in writing to A.I.D. by the importer and shall include supporting justification together with the recommendations of the borrower/grantee. In the absence of other instructions, such applications shall be submitted to the US AID for transmittal to AID/W. Notice of approval or rejection of any such application of a waiver will normally be transmitted to the importer through the US AID.

(3) Emergency procurement. (i) Commodity procurement necessary to avoid a serious delay in project completion or in a plant's production, or to avoid a substantial increase in the cost thereof, if the procurement cannot be effected within the time limitations prescribed by paragraph (a) of this section for notification procedures.

(ii) A request for an emergency procurement waiver shall be made by the importer to the US AID. The request shall state the facts justifying such emergency procurement and shall bear the endorsement of the borrower/ grantee. Emergency procurement requires the prior written approval of the US AID.

(4) Special situations. (i) Procurement in special situations, if AID/W has determined that it would be impracticable or inconsistent with the purposes of the Act to require adherence to the notification procedures prescribed in paragraph (a) of this section.

(ii) A request for a special situation waiver shall be made by the importer to the US AID. The request shall justify the procurement and shall bear the endorsement of the borrower/grantee. In the absence of other instructions, the US AID shall transmit the request to AID/W for decision.

§ 201.25 Advance and progress payments for custom-made commodities.

(a) Advance or progress payments prior to shipment may be made with A.I.D. funds if the procurement involves any commodity made to the special specifications of the importer and if prior

written approval to make such payments has been obtained from A.I.D. by the importer, through the borrower/grantee, or if such payments are authorized in the implementing document. Any request for A.I.D. approval may be submitted either to AID/W or to the US AID for transmittal to AID/W. A.I.D. will consider any such request only if

(1) The total purchase price exceeds $100,000;

(2) Each payment is at least ten percent of such price; and

(3) The total of all payments prior to shipment does not exceed eighty percent of the purchase price.

(b) A.I.D. may require the supplier to post in A.I.D.'s favor either a guaranty of performance or a prepayment bond equal to the amount of the contract. A.I.D. may impose such further conditions as it deems appropriate.

§ 201.26 Bid bonds and performance guaranties.

Whenever the importer requires the posting of a bid bond or performance guaranty, the type of bond or guaranty (whether certified check, irrevocable letter of credit, bank bond, bank guaranty, surety bond, or otherwise) shall be at the option of the bidder or supplier. Posted bid bonds shall be returned to unsuccessful bidders promptly after an award is made. Unless converted to a required guaranty of performance, any bid bond posted by the successful bidder shall also be

returned promptly. Performance guaranties (as distinguished from commodity warranties of quality or performance) shall be canceled no later than 30 days after completion of the contract performance guaranteed.

This subpart establishes the responsibilities of suppliers who furnish commodities and/or commodity-related services. The subpart also establishes procedures for prior review by A.I.D. of relevant contract data.

§ 201.31 Suppliers of commodities.

(a) Performance of the sales contract. The supplier of commodities shall comply with the terms and conditions of his contract with the importer and of any letter of credit under which he secures payment.

(b) Eligibility of commodities. The supplier shall fulfill his responsibilities under § 201.11 by assuring that

(1) The commodity conforms to the description contained in his contract and letter of credit and, unless otherwise authorized by A.I.D. in writing, the commodity is unused and has not been disposed of as surplus by any governmental agency;

(2) The source of the commodity complies with the provisions of § 201.11(b), relating to source as required by his contract or letter of credit, and with the provisions of § 201.11(h), relating to commodities shipped out of free port or bonded warehouse, if the supplier arranged transportation to the free port or bonded warehouse;

(3) The provisions of § 201.11(d) relating to the medium of transportation are complied with to the extent that the supplier arranges such transportation;

(4) All documents required by § 201.52 to be submitted by the supplier to receive payment are submitted by him on or before the terminal date specified in the letter of credit, or, if there is no letter of credit, in his contract;

(5) The provisions of the U.S. Treasury Department Foreign Assets Control Regulation and Cuban Assets Control Regulation are complied with; and

(6) The purchase price of the commodity meets the requirements of Subpart G applicable to the supplier.

(c) Eligibility of delivery services. The supplier of commodities shall be responsible for assuring that any delivery services obtained by him for his own or

for the importer's account comply with the requirements (other than those relating to freight rates) of § 201.13 and, if required by A.I.D., for assuring that any shipping documents obtained by him contain an appropriate diversion clause pursuant to § 201.43. The supplier shall deliver to A.I.D. any shipping documents available to him whenever such delivery is requested by A.I.D.

(d) Commodity marking-(1) Affixation of emblem and identification number. The supplier shall be responsible for assuring that all commodities and their shipping containers, whether shipped from the United States or from any other source country, carry the official A.I.D. (clasped hands) emblem and, in addition, in the case of commodities furnished to countries participating in the Alliance for Progress, the Alliance for Progress (flaming torch) emblem. Emblems shall be affixed by metal plate, decalcomania, stencil, label, tag, or other means, depending upon the type of commodity or shipping container and the nature of the surface to be marked. The emblem placed on the commodities shall be as durable as the trademark, company or brand name affixed by the producer; the emblem on each shipping container shall be affixed in a manner which assures that the emblem will remain legible until the container reaches the consignee. Upon each shipping container the last set of digits of the identification number of the pertinent implementing document shall be marked in characters at least equal in height to the shipper's marks.

(i) Size of emblems. The size of an emblem may vary depending upon the size of the commodity and the size of the package or shipping container. The emblem shall in every case be large enough to be clearly visible at a reasonable distance.

(ii) Design and color of emblems. Emblems shall conform in design and color to samples available from AID/W (Office of Small Business) and from the US AID.

(2) Exception to requirement for affixation of emblems. To the extent compliance is impracticable, affixation shall not be required for

(i) Raw materials shipped in bulk (including grain, coal, petroleum, oil, and lubricants);

(ii) Vegetable fibers packaged in bales; and

(iii) Semifinished products which are not packaged in any way.

(3) Waiver. If compliance with the marking requirement is found to be impracticable with respect to other commodities not excepted by subparagraph (2) of this paragraph (d), the supplier (or, when appropriate, the borrower/ grantee) may request AID/W (Office of Small Business) for a waiver.

(4) Display of emblems on ships. The official A.I.D. (clasped hands) emblem, and, in addition, in the case of shipments to countries participating in the Alliance for Progress, the Alliance for Progress (flaming torch) emblem shall be prominently displayed on all ships during loading and unloading when their cargoes consist entirely of A.I.D.-financed goods. Ship charterers shall insert in charter party agreements instructions relating to the display of A.I.D. emblems.

(e) Export licenses. The supplier shall assure that all necessary export licenses are obtained.

(f) Airmail distribution of shipping documents. In addition to customary commercial document distribution the supplier shall, at the time of loading the commodities or as soon as practicable thereafter, airmail one set of the following documents to the Controler, US AID, c/o American Embassy in the capital city of the cooperating country to which shipment is being made, or to such other address as is designated to him: a nonnegotiable copy of the ocean or charter party bill of lading or other shipping document, supplier's invoice, and packing list. The supplier shall indicate on each such document the number of the applicable implementing document, if known to the supplier.

(g) Adjustment refunds, credits, and allowances. All adjustments in the purchase price in an A.I.D.-financed transaction in favor of the importer arising out of the terms of the contract or the customs of the trade shall be made by the supplier in the form of a dollar payment to A.I.D. Any such payment shall be transmitted to the Office of the Controller, A.I.D., Washington, D.C.,

and shall be accompanied by a statement explaining the adjustment and shall specify the name and address of the importer, the date and amount of the original invoice, and the identification number of the implementing document, if known, under which the original transaction was financed. A.I.D. will advise the borrower/grantee of such adjustment refunds received. Despatch earned by the supplier, other than despatch earned at the port of loading on c.i.f. and c. & f. shipments, shall be refunded to A.I.D. in accordance with the provision of § 201.67 (a) (5).

(h) Vesting in A.I.D. of title to commodities. The supplier shall be responsible for compliance with the provisions of § 201.44 applicable to him.

(i) Termination or modification of A.I.D. financing. The supplier shall be responsible for compliance with the provisions of § 201.45 applicable to him.

§ 201.32 Suppliers of delivery services.

(a) Performance of the service contract. The supplier of delivery services financed by A.I.D. shall comply with the terms and conditions of his contract to supply delivery services.

(b) Emblems. A supplier of ocean transportation services shall assure that the A.I.D. emblem and, where applicable, the Alliance for Progress emblem are prominently displayed, during loading and unloading, on any ship whose cargo consists entirely of A.I.D.-financed commodities.

(c) Adjustments in the price of delivery services. The supplier of delivery services shall pay to the Controller, A.I.D., Washington, D.C. 20523, all adjustments in the purchase price in favor of the importer (or person purchasing the ocean transportation services) arising out of the terms of the contract or the customs of the trade. Any such payment shall be accompanied by a statement explaining the adjustment and shall specify the name and address of the importer or other person for whom the adjustment is made, the date and amount of the original invoice, and the identification number of the implementing document, if known, under which the original transaction was financed.

(d) Marine insurance reporting requirement. With respect to any loss payment in excess of $6,000 which a supplier of marine insurance makes under a marine insurance policy financed pursuant to this part, the supplier of marine

insurance shall, within 15 days of making such payment, report to A.I.D., Office of the Controller, the amount and date of the payment, a description of the commodity, the A.I.D. numbers, name of the carrier, vessel, and voyage number (alternatively, flight or inland carrier run number), date of the bill of lading, the identity and address of the assured, and the identity and address of any assignee of the assured to whom payment has actually been made.

§ 201.33 Prior review of proposed sales.

A.I.D. may require that a supplier submit to A.I.D. for prior review any proposed sale of commodities or of commodity-related services which is to be financed by A.I.D. Upon being notified by A.I.D. that such prior review will be required, the supplier shall submit to A.I.D. for review all proposed transactions of the type covered by the notification in accordance with instructions contained therein. The supplier shall also provide any further information, documentation, or certification which A.I.D. may specify after review of a proposed transaction. A.I.D. will notify the supplier of any special documents or certifications which the supplier must submit in order to obtain payment under such transactions and will forward to the banks appropriate amendments to letters of commitment or to requests for the opening of a special letter of credit. Subpart E-General Provisions Relating to A.I.D. Financing of Commodities and Commodity-Related Services

§ 201.40 Purpose.

This subpart sets forth certain provisions of general application to transactions subject to this part.

§ 201.41

Audit and inspection.

The borrower/grantee shall maintain records adequate to document the arrival and disposition in the cooperating country of all commodities financed by A.I.D. and to identify the importer (or the first purchaser or transferee if the commodity is imported by the borrower/ grantee) for a period of 5 years following the date of payment or reimbursement by A.I.D. or for such other period as A.I.D. and the borrower/grantee agree. In addition, the borrower/grantee or the importer shall, to the extent either exercises control or custody over the com