CCC's obligation. The payment guarantee will provide that CCC agrees to pay the holder of the payment guarantee an amount not to exceed the guaranteed value, plus Eligible interest, in the event that the foreign financial institution fails to pay under the foreign financial institution letter of credit and, if applicable, the terms and conditions document. Payment by CCC will be in U.S. dollars.

Period of guarantee coverage. The payment guarantee becomes effective on the Date(s) of Performance. For goods, the period of coverage will apply from the date on which interest begins to accrue, if earlier than the date of performance. The payment guarantee will apply to the period beginning with the Date(s) of Performance and will continue during the credit term specified in the payment guarantee or amendments thereto.

Terms of the CCC payment guarantee. The terms of CCC's coverage will be set forth in the payment guarantee, as approved by CCC, and will include the provisions of this subpart, which may be supplemented by any program announcements and notices to participants in effect at the time the payment guarantee is approved by CCC.

Final date of performance. The final allowable date of performance will be specified on the payment guarantee.

U.S. content test. (1) Except as allowed under § 1493.290(f), CCC will issue a payment guarantee only if the following items collectively represent less than 50 percent of the sum of the net contract value and the value of approved local costs:

The value of eligible non-U.S. goods; and

The value of imported components.

Imported raw materials and basic manufactured items (such as iron, steel, nuts, bolts, etc.) which are processed, assembled or manufactured in the United States are automatically included in CCC's coverage and are not counted as imported components for the purpose of determining U.S. content.

Coverage waiver. (1) The seller may request a coverage waiver for any of the following:

To allow for guarantee coverage of non-U.S. goods; and/or

The U.S. content test, allowing for guarantee coverage of non-U.S. goods and imported components in U.S. goods in excess of the value permitted under the U.S. content test.

To request a coverage waiver on one of the bases specified in paragraph (f)(1) of this section, the seller must submit with the initial application for a payment guarantee a justification of why the non-U.S. goods and/or imported components in U.S. goods are essential to the completion of the FGP transaction. This justification must be based on one of the following:

The goods and/or components are no longer manufactured in or provided by the United States;

The use of U.S. goods and/or components is not cost effective; or

U.S. goods and/or components are not compatible with the existing infrastructure in the destination country.

In determining whether to grant a coverage waiver, CCC will consider the following factors:

Whether information obtained by CCC from industry sources, government agencies, or any other sources supports the justification provided by the seller;

Whether the non-U.S. goods (and/or imported components in U.S. goods) are essential to the completion of the transaction; and

Any other information CCC determines is relevant.

Certain transactions are ineligible for payment guarantees. A transaction (or any portion thereof) is ineligible for payment guarantee coverage if at any time CCC determines that:

The sale includes corrupt payments or extra sales or services or other items extraneous to the transactions provided, financed, or guaranteed in connection with the transaction;

The sale does not comply with applicable U.S. law, including the Foreign Corrupt Practices Act of 1977 and other anti-bribery measures;

The buyer is excluded or disqualified from participation in U.S. government programs;

The goods, services, and/or facility being financed will not primarily benefit U.S. agricultural commodity exports;

The sale is not an eligible export sale.

Certain contractual events are ineligible for payment guarantee coverage. The following contractual events are ineligible for coverage under an FGP payment guarantee, except where it is determined by the Director to be in the best interest of CCC to provide guarantee coverage on such contractual events:

Contractual events with a date of performance prior to the date of receipt by CCC of the seller's written initial application for a payment guarantee;

Contractual events with a date of performance later than the final date of performance shown on the payment guarantee or any amendments thereof;

Contractual events where the date of issuance of a foreign financial institution letter of credit is later than the date of performance; or

Contractual events that have been guaranteed by CCC under another payment guarantee. If CCC determines that the contractual event has been guaranteed under multiple payment guarantees (or coverage has been requested under multiple payment guarantees), CCC will determine which payment guarantee (or application for payment guarantee), if any, corresponds to an eligible export sale.

Additional requirements. The payment guarantee may contain such additional terms, conditions, and limitations as deemed necessary or desirable by the Director. Such additional terms, conditions or qualifications as stated in the payment guarantee are binding on the seller and the assignee.

Amendments to the firm sales contract. Any amendments to the firm sales contract that impact contractual event(s) covered by the payment guarantee must be submitted to CCC for approval for coverage prior to the date of performance of the contractual event.

Amendments to the payment guarantee. A request for an amendment of a payment guarantee may be submitted only by the seller, with the written concurrence of the assignee, if any, and must be accompanied by the revised firm sales contract, if applicable. The Director will consider such a request only if the amendment sought is consistent with this subpart and any applicable program announcements and sufficient budget authority exists. Any amendment to the payment guarantee, particularly those that result in an increase in CCC's liability under the payment guarantee, may result in an increase in the guarantee fee. CCC reserves the right to request additional information from the seller to justify the request and to charge a fee for amendments. Such fees will be announced and available on the USDA Web site. Any request to amend the foreign financial institution on the payment guarantee will require that the holder of the payment guarantee resubmit to CCC the certification in § 1493.310(c)(1)(i) or § 1493.330(d).