such handler and that no handler shall receive almonds in excess of his contribution. Such restoration to the salable quantity shall be deemed to fulfill the obligation of the Board with respect to the increase in the salable percentage. § 981.60 Determination of kernel weight.

(a) Almonds for which settlement is made on kernel weight. All lots of almonds, whether shelled or unshelled, for which settlement is made on the basis of kernel weight shall be included in the total kernel weight for any handler at the settlement weight.

(b) Almonds for which settlement is made on unshelled weight. Any unshelled almonds for which settlement is made on the basis of unshelled weight shall be included in the total kernel weight for any handler at the settlement weight of such unshelled almonds multiplied by the applicable shelling ratio in accordance with § 981.62. § 981.61

Redetermination of kernel

weight.

The Control Board, on the basis of reports by handlers, shall redetermine the kernel weight of almonds received by each handler for his own account during each crop year through each of the following dates: December 31, March 31, and June 30. Such redetermined kernel weight for each handler shall be the basis for computing his surplus obligation for the crop year through such dates, except that adjustment shall be made for almonds on which the obligation has been assumed by another handler. The redetermined kernel weight for each handler as of any date during the crop year shall be his carryover as of that date, plus deliveries of salable almonds (except deliveries, other than certified surplus, to oil mills or animal feed under the supervision of the Board), plus certified surplus for such crop year to that date (whether or not disposed of), minus his carryover at the beginning of the crop year, minus any almonds on which the surplus obligation has been assumed by a previous handler. Weights used in such computation for various classifications of almonds shall be: (a) For unshelled almonds, other than certified surplus, the kernel weight computed by application of shelling ratios authorized pursuant to §981.62; (b) for unshelled certified as surplus, the certified kernel weight; (c) for shelled almonds

(b) Lots of unshelled almonds designated by a handler as unknown or unnamed varieties, or varieties of a name not listed in this section, also lots of mixed varieties (lots containing more than 10 percent by weight of unshelled almonds which differ materially in shape or appearance from the predominant variety in the lot) shall be converted to kernel weight at 60 percent, unless the handler, at his expense, furnishes an inspection certificate applicable to the lot, issued by the inspection agency, showing the kernel weight of the lot. The shelling ratios in this section may be changed by the Secretary, and shelling ratios for other varieties may be specified by him, upon consideration of a Control Board recommendation and other available data.

DISPOSITION OF SURPLUS

§ 981.65 Prohibition on the use or disposition of surplus almonds.

Except as provided in §§ 981.66 and 981.67, almonds that are withheld as surplus pursuant to the requirements of § 981.50 or are creditable in satisfaction of a surplus withholding obligation thereunder, shall not be used or disposed of by any handler or any other person. [22 F. R. 8486, Oct. 26, 1957]

§ 981.66 Conditions governing disposition of surplus.

(a) General. The Control Board shall have power and authority to sell or dispose of any and all surplus almonds withheld upon the best terms and at the highest return obtainable consistent with the ultimate complete disposition of surplus, subject to all conditions of this section.

(b) Disposition of surplus for export. Sales of surplus almonds for export to destinations outside the continental United States, Alaska, Hawaii, Puerto Rico, and the Canal Zone shall be made only on execution of an agreement to prevent sale within or reimportation into the United States; and in case of export to Canada or Mexico, such almonds shall be sold only on the basis of a delivered price, duty paid.

(c) Exclusion from domestic normal trade channels. No surplus almonds shall be sold in the United States, Alaska, Hawaii, Puerto Rico, and the Canal Zone other than to governmental agencies or to charitable institutions for charitable purposes, except for diversion into al

mond oil, almond butter, poultry or animal feed, or into other channels which the Control Board finds are noncompetitive with existing normal markets for almonds, and with proper safeguards in each case to prevent such almonds thereafter entering the channels of trade in such normal markets.

(d) Time restriction on disposition. The Control Board shall not dispose of, or authorize the disposition of, more than 50 percent of the surplus almonds prior to May 15 of any crop year unless disposition in excess of 50 percent is made pursuant to paragraph (b) of this section or unless the salable percentage is increased pursuant to § 981.48.

(e) Disposition after September 1. Any surplus almonds remaining unsold as of September 1 shall be disposed of by the Board as soon as practicable through the most readily available surplus outlets. The date of September 1 herein specified may be extended to a later date by the Secretary, upon recommendation of the Board or other information.

§ 981.67 Disposition by handler.

Upon request of a handler, made prior to the delivery by him of any surplus to the Board in any crop year, the Board shall authorize such handler to act as agent of the Board, upon such reasonable terms and conditions as the Board may specify and subject to the conditions of 981.66 in disposing of the surplus contributed by such handler for that crop year. Any handler who is authorized to dispose of his surplus may, through arrangement with another handler, dispose of such surplus through such other handler or, in lieu of disposition, may acquire credits for surplus disposition from another handler. In the first instance, the second handler shall also be subject to the conditions of § 909.66. It shall be the obligation of any handler authorized to dispose of such surplus to effect disposition thereof in accordance with all applicable requirements and conditions. The proceeds of such disposition shall be retained by the handler making the disposition, except that, in case he disposes of the surplus of another handler, the proceeds from that disposition shall be divided between the two handlers on the basis of a mutual agreement. Such authorization shall expire as of September 1 of the next crop year, and any surplus then remaining undisposed of by the handler shall be returned

to the Board. If the date of September 1 specified in § 981.66 (e) is extended, the date of September 1 shall be extended correspondingly. Any handler who has been authorized to act as agent of the Board in disposing of his surplus may terminate such agency as of April 1 of the particular crop year by giving written notice to the Board to that effect not later than the previous March 20, in which event such handler shall return to the Board, for disposition by it, all surplus almonds remaining in his possession. In case a handler does not terminate his agency as of April 1, he shall be required to continue to serve as such agent until September 1 of the next crop year. The Board shall not terminate such an agency prior to September 1 unless the agent violates the terms and conditions specified by the Board or other provisions of the order. During the period of such agency the Board, as principal, shall not dispose of the surplus contributed by said agent. The Board, with the approval of the Secretary, may prescribe such rules and regulations as are necessary to regulate disposition of surplus almonds including methods for crediting as surplus any salable almonds sold and delivered to surplus outlets. § 981.68 Disposition by the Board.

(a) Pools. Surplus from almonds received by handlers for their own accounts during any crop year, other than surplus disposed of by handlers as agents of the Board as authorized in § 981.67, shall be disposed of by the Control Board in three pools as follows: Pool No. 1-surplus delivered to the Board during a crop year up to April 1 and disposed of during that period; Pool No. 2-surplus delivered to the Board from April 1 to August 31, inclusive, and disposed of during that period, including, in addition to deliveries by handlers not acting as agents, deliveries by handlers who terminate their agencies as of April 1, and also any surplus from Pool No. 1 which was not disposed of prior to April 1, but which is disposed of prior to September 1; and Pool No. 3-all surplus held unsold by the Board on September 1, including, in addition to any surplus turned over to it by handlers whose agencies expired on September 1, any surplus from Pool No. 1 and Pool No. 2 which was not disposed of by the Board prior to September 1. If the date of September 1 specified in § 981.66 (e) is extended, the dates of Au

gust 31 and September 1 shall be extended correspondingly.

expenses in

(b) Expenses. Direct curred by the Control Board in the maintenance and disposition of surplus almonds in each respective pool shall be charged against the proceeds of sales of the almonds in that pool.

(c) Distribution to handlers. Net proceeds from the disposition of surplus almonds in each of the three pools shall be distributed by the Board to each handler having an interest in that pool in proportion to his relative contribution thereto in terms of certified kernel weight. In the case of a carryover from one pool to another pool, the Board shall allocate the interests of the appropriate handlers therein on the basis of their respective total deliveries of almonds, in terms of certified kernel weight, to the Board during the pool period in connection with which such carryover first originated.

§ 981.70

RECORDS AND REPORTS

Records and verification.

Each handler shall keep records which will clearly show the details of his receipts of almonds, withholdings, sales, shipments, inventories, surplus disposition and other pertinent information in respect to his operations pursuant to the provisions of this part. Such records shall be retained by the handler for two years after the end of the crop year to which they apply. Each handler's premises shall be accessible to authorized representatives of the Board and the Secretary for examination and audit of the aforesaid records and for inspection and observation of almonds. The Board shall make such checks of almonds or audits of each handler's records as it deems appropriate or are requested by the Secretary to insure that accurate information as required in this part is being furnished by handlers.

inafter provided. Such receipts shall be serially numbered and shall accurately show for each lot received, the identity of the handler, the name and address of the person from whom received, the number of containers in the lot, the variety, whether shelled or unshelled, and the settlement weight for each such variety. The character and amount of all adjustments deducted from the gross weight shall be shown with the gross weight on the receipt issued by the handler.

§ 981.72 Report of receipts.

Each handler receiving almonds for his own account shall tabulate such receipts by varieties and shall submit reports thereof to the Control Board in such form and at such intervals as the Board may prescribe for all receipts issued by him. Such reports shall be accompanied by duplicate copies of the receipts issued pursuant to the provisions of § 981.71 for all almonds included in such report. The Control Board, after checking such reports in such manner as it deems desirable, shall determine in the manner specified in § 981.60 the kernel weight of the almonds so received.

§ 981.73 Periodic reports.

On or before January 15, and April 15, and July 15 of each crop year, each handler shall file with the Control Board a written report, certified to the Board and to the Secretary by such handler as to its completeness and correctness, showing as of the close of business on December 31, March 31, and June 30, respectively, such information as may be prescribed by the Board for use in redetermination of kernel weight and marketing policy considerations.

§ 981.74 Other reports.

Upon the request of the Control Board, made with the approval of the Secretary, every handler shall furnish to the Control Board in such manner and at such times as it prescribes (in addition to such other reports as are specifically provided for in this part) such other information as will enable the Control Board to perform its duties and exercise its powers hereunder.

§ 981.75 Confidential nature of records

and reports.

All information contained in handler records made available to the Board or the Secretary, or in reports to the Board,

The Control Board is authorized to incur such expenses as the Secretary may find are reasonable and likely to be incurred by it during each crop year, for the maintenance and functioning of the Control Board and for such purposes as the Secretary may, pursuant to the provisions of this subpart, determine to be appropriate. The recommendation of the Control Board as to the expenses for each such year, together with all data supporting such recommendation, shall be submitted to the Secretary on or before August 1 of the crop year in connection with which such recommendation is made.

(a) Requirement for payment. Each handler shall pay to the Control Board on demand by the Board, from time to time, such sum, based on such rate per pound of almonds, kernel weight basis, received by him for his own account (except as to receipts from other handlers on which assessments have been paid) as the Secretary finds is necessary to provide funds to meet the authorized board expenses and establishes for the crop year. Upon redetermination of the kernel weight of almonds received by handlers for their own account as provided in § 981.61, such redetermined kernel weight for each handler, adjusted for receipts on which assessments have been paid, shall be the basis upon which he shall pay assessments. At any time during or after a crop year, the Secretary may increase the rate of assessments to apply to all such almonds during such crop year to secure sufficient funds to cover the expenses authorized by § 981.80 or by any later finding by the Secretary relative to the expenses of the Control Board, and such additional assessments shall be paid to the Control Board by each handler on demand.

(b) Refunds. Any money collected as assessments during any crop year and not expended in connection with the respective crop year's operations under this part may be used and shall be refunded by the Control Board in accordance with the provisions of this part. Such excess funds may be used by the Control Board during the period of four months subsequent to such crop year in paying the expenses of the Control Board incurred in connection with the new crop year. The Control Board shall, however, from funds on hand, including assessments collected during the new crop year, distribute or make available, within five months after the beginning of the new crop year, the aforesaid excess to each handler from whom an assessment was collected, as aforesaid, in the proportion that the amount of the assessment paid by the respective handler bears to the total amount of assessments paid by all handlers during said crop year.

(c) Disposition of funds upon termination. Any money collected from assessments hereunder and remaining unexpended in possession of the Control Board upon the termination of this part shall be distributed in such manner as the Secretary may direct.

MISCELLANEOUS PROVISIONS

No member or alternate member of the Control Board, or any employee or agent thereof, shall be held personally responsible, either individually or jointly with others, in any way whatsoever, to any handler or any other person for errors in judgment, mistakes, or other acts either of commission or omission, as such member, alternate member, agent, or employee, except for acts of dishonesty. § 981.86 Separability.

If any provision of this subpart is declared invalid, or the applicability thereof to any person, circumstance, or thing is held invalid, the validity of the remainder hereof or the applicability thereof to any other person, circumstance, or thing shall not be affected thereby.

(a) Effective time. The provisions of this subpart, as well as any amendments to this subpart, shall become effective at such time as the Secretary may declare, and shall continue in force until terminated or suspended in one of the ways hereinafter specified in this section.

(b) Suspension or termination—(1) Failure to effectuate policy of act. The Secretary shall terminate or suspend the operation of any or all of the provisions of this subpart, whenever he finds that such provisions do not tend to effectuate the declared policy of the act.

(2) When favored by growers. The Secretary shall terminate the provisions of this subpart at the end of any crop year whenever he finds that such termination is favored by a majority of the growers of almonds who during the crop year have been engaged in the production for market of almonds in the State of California: Provided, That such majority have during such period produced for market more than 50 percent of the volume of such almonds produced for market within said State; but such termination shall be effected only if announced on or before June 1 of the then current crop year.

(3) If enabling legislation is terminated. The provisions of this subpart shall, in any event, terminate whenever the provisions of the act authorizing them cease to be in effect.

(c) Proceedings after termination(1) Designation of trustees. Upon the