Food and Agricultural Organization

The FAO was established in 1945, as a specialized agency of the United Nations to combat hunger and malnutrition. The FAO serves as a coordinating body between government representatives, scientific groups, and non-governmental organizations to carry out development programs relating to food and agriculture.

Food For Progress

The Food for Progress program is carried out by the Department of Agriculture, using the authority of either Public Law 480 or Section 416 of the Agricultural Act of 1949. The program provides commodities to needy countries to encourage agricultural reform. In fiscal year 1991, no agreements were signed under the FFP program. Public Law 480 is a food aid and market development program that focuses on the needs of developing countries and is aimed at establishing a U.S. presence in such markets and supporting their economic growth. Section 416 of the Agricultural Act of 1949 provides for the donation of food and feed commodities owned by Agriculture’s Commodity Credit Corporation and is focused on people in developing countries.

Force Majeure

The title of a standard clause in marine contracts exempting the parties for non-fulfillment of their obligations as a result of conditions beyond their control, such as earthquakes, floods, or war.

Foreign Affiliate of a Foreign Parent

A foreign affiliate of a foreign parent is, with reference to a given U.S. affiliate, any member of the affiliated foreign group owning the U.S. affiliate that is not a foreign parent of the U.S. affiliate.

Foreign Agricultural Service

The Foreign Agricultural Service, FAS, is an agency of the Department of Agriculture. FAS maintains a global network of agricultural officers as well as a Washington-based staff to analyze and disseminate information on world agriculture and trade, develop and expand export markets, and represent the agricultural trade policy interests of U.S. producers in multilateral forums. FAS also administers USDA’s export credit and concessional sales programs.

Foreign Assets Control

The Treasury Department’s Office of Foreign Assets Control, OFAC, administers sanctions programs involving specific countries and restricts the involvement of U.S. persons in third country strategic exports, i.e., the Denied Parties List.

Foreign Assistance Act of 1991

This Act replaced the Support for East European Democracy (SEED) Act. The Foreign Assistance Act allows support to 26 countries, including all East European nations and most of the Soviet republics, but not to the Soviet Union itself

Foreign Availability

The Bureau of Export Administration conducts reviews to determine the foreign availability of selected commodities or technology subject to export control. The reviews use four criteria to determine foreign availability: comparable quality, availability in-fact, foreign source, and adequacy of available quantities that would render continuation of the U.S. control ineffective in meeting its intended purpose. A positive determination of foreign availability means that a nonU.S. origin item of comparable quality may be obtained by one more proscribed countries in quantities sufficient to satisfy their needs so that U.S. exports of such item would not make a significant contribution to the military potential of such countries. A positive determination may result in the decontrol of a U.S. product that has been under export control, or the approval of an export license. However, the control may be maintained if the President invokes the national security override provision of the Act. Beginning with the 1977 amendments to the Export Administration Act, the Congress directed that products with foreign availability be identified and decontrolled unless essential to national security. In January 1983, a program to assess the foreign availability of specific products was established within the Office of Export Administration, now the Bureau of Export Administration, or BXA. Further, 1985 amendments to the Act directed that an Office of Foreign Availability be created.

Foreign Buyer Program

Foreign Buyer Program, FBP, is a joint industry-International Trade Administration program to assist exporters in meeting qualified foreign purchasers for their product or service at trade shows held in the United States. ITA selects leading U.S. trade shows in industries with high export potential. Each show selected for the FBP receives promotion through overseas mailings, U.S. embassy and regional commercial newsletters, and other promotional techniques. ITA trade specialists counsel participating U.S. exhibitors.

Foreign Corrupt Practices Act

The FCPA prohibits U.S. individuals, companies and direct foreign subsidiaries of U.S. companies from offering, promising, or paying anything of value to any foreign government official in order to obtain or retain business.

Foreign Credit Insurance Association

The FCIA is an agency of the Export-Import Bank which offers insurance covering political and commercial risks on export receivables. FICA was founded in 1961 as a partnership of Eximbank and a group of private insurance companies. Eximbank is responsible for the political risk and may underwrite or reinsure the commercial risk. FCIA acts as an agent responsible for the marketing and daily administration of the program.

Foreign Direct Investment in the United States

Foreign direct investment in the United States is the ownership or control, directly or indirectly, by a single foreign person (an individual, or related group of individuals, company, or government) of 10 percent or more of the voting securities of an incorporated U.S. business enterprise or an equivalent interest in an unincorporated U.S. business enterprise,, including real property. Such a business is referred to as a U.S. affiliate of a foreign direct investor. See: Committee on Foreign Investment in the United States; Foreign Person; Portfolio Investment

Foreign Economic Trends

FETs are reports prepared by U.S. embassies abroad to describe foreign country economic and commercial trends and trade and investment climates. The reports describe current economic conditions; provide updates on the principal factors influencing developments and the possible impacts on American exports; review newly announced foreign government policies as well as consumption, investment, and foreign debt trends.

Foreign Exchange

The currency or credit instruments of a foreign country. Also, transactions involving purchase and/or sale of currencies.

Foreign Exports

Exports of foreign merchandise (re-exports), consist of commodities of foreign origin which have entered the United States for consumption or into Customs bonded warehouses or U.S. Foreign Trade Zones, and which, at the time of exportation, are in substantially the same condition as when imported.

Foreign Flag

A reference to a carrier not registered in the United States that flies the American flag. The term applies to air and sea transportation. See: Foreign Freight Forwarder; Freight Forwarder.

Foreign Independent Tour

A foreign independent tour, FIT, is a prepaid travel arrangement, tailored to meet a traveler’s specific wishes.

Foreign Investment. See: Committee on Foreign Investment in the United States;

Net Foreign Investment

Foreign Market Research. See: Industry Subsector Analysis

Foreign Market Value

The price at which merchandise is sold, or offered for sale, in the principal markets of the country from which it is exported. If information on foreign home market sales is not useful, the foreign market value is based on prices of exports to third countries or constructed value. Adjustments for quantities sold, circumstances of sales, and differences in the merchandise can be made to those prices to ensure a proper comparison with the prices of goods exported to the United States.

Foreign Military Sales. See: Conventional Arms Transfer

Foreign Parent

The first foreign person or entity outside of the United States in an affiliate’s ownership chain that has direct investment in the affiliate. The foreign parent consists ~j.y of the first person or entity outside the United States in the affiliate’s ownership chain; all other affiliated foreign persons are excluded.

Foreign Parent Group

A foreign parent group, FPG, consists of: (1) the foreign parent, (2) any foreign person or entity, proceeding up the foreign parent’s ownership chain, that owns more than 50 percent of the party below it, up to and including the ultimate beneficial owner (UBO), and (3) any foreign person or entity proceeding down the ownership chain(s) of each of these members, that is owned more than 50 percent by the party above it. A particular U.S. affiliate may have several ownership chains above it, if it is owned at least 10 percent by more than one foreign party. In such cases, the affiliate may have more than one foreign parent, UBO, and/or foreign parent group.

Foreign Person

A foreign person is any person resident outside the United States or subject to the jurisdiction of a country other than the United States. “Person” is any individual, branch, partnership, association, associated group, estate, trust, corporation, or other organization (whether or not organized under the laws of any State), and any government (including a foreign government, the U.S. Government, a State or local government, and any agency, corporation, financial institution, or other entity or instrumentality thereof, including a government sponsored agency.)

Foreign Policy Controls

Foreign policy controls are distinct from national security controls (CoCom or other international agreements) and are imposed to further U.S. foreign policy. The controls are typically imposed in response to developments in a country or countries — such as considerations regarding terrorism and human rights — or to developments involving a type or types of commodities and their related technical data. Foreign policy controls expire annually, unless extended.

Foreign-Owned Affiliate in the U.S.

A business in the United States in which there is sufficient foreign investment to be classified as direct foreign investment. To determine fully the foreign owners of a U.S. affiliate, three entities must be identified: the foreign parent, the ultimate beneficial owner, and the foreign parent group. All these entities are “persons” in the broad sense: thus, they may be individuals; business enterprises; governments; religious, charitable, and other nonprofit organizations; estates and trusts; and associated groups. An U.S. affiliate may have an ultimate beneficial owner (UBO) that is not the immediate foreign parent; moreover, the affiliate may have several ownership chains above it, if it is owned at least 10 percent by more than one foreign person. In such cases, the affiliate may have more than one foreign parent, UBO, and/or foreign parent group.

Foreign Sales Agent

An individual or firm that serves as the foreign representative of a domestic supplier and seeks sales abroad for the supplier.

Foreign Sales Corporation

A corporation created to secure U.S. tax exemption on a portion of earnings derived from the sale of U.S. products in foreign markets. To qualify for special tax treatment, a FSC must be a foreign corporation, maintain an office outside the U.S. territory, maintain a summary of its permanent books of account at the foreign office, and have at least one director resident outside the U.S.

Foreign Service

The Foreign Service supports the President and the Secretary of State in pursuing America’s foreign policy objectives. Foreign service functions include: representing U.S. interests; operating U.S. overseas missions; assisting Americans abroad; public diplomacy and reporting; communicating and negotiating political, economic, consular, administrative, cultural, and commercial affairs. The Foreign Service comprises officers from the Departments of State, Commerce, and Agriculture and the United States Information Service. See: Commercial Officers; Economic Officers

Foreign Service Institute (FSI)

FSI was founded in 1946 to train U.S. foreign and civil service officials. Training courses cover administrative, consular, economic, commercial, and political work, foreign languages, and diplomatic life overseas.

Foreign Trade Statistics Regulations (FTSR)

Legal definitions and requirements for SEDs and the AES, including information relating to the who, what, where, and when of the exportation.

Foreign Trade Zones (FTZ)

FTZs (or free zones, free ports, or bonded warehouses) are special commercial and industrial areas in or near ports of entry where foreign and domestic merchandise, including raw materials, components, and finished goods, may be brought in without being subject to payment of customs duties. Merchandise brought into these zones may be stored, sold, exhibited, repacked, assembled, sorted, graded, cleaned, or otherwise manipulated prior to reexport or entry into the national customs territory. FTZs are restricted-access sites in or near ports of entry, which are licensed by the Foreign-Trade Zones Board and operated under the supervision of the Customs Service. Zones are operated under public utility principles to create and maintain employment by encouraging operations in the U.S. that might otherwise have been carried on abroad. Quota restrictions do not normally apply to foreign goods stored in zones, but the Board can limit or deny zone use in specific cases on public interest grounds. Domestic goods moved into a zone for export may be considered exported upon entering the zone for purposes of excise tax rebates and drawback. “Subzones” are a special-purpose type of ancillary zone authorized by the Board, through grantees of public zone when it can be demonstrated that the activity will result in significant public benefit and is in the public interest. Goods in a zone for a bona fide Customs reason are exempt from state and local ad valorem tax. See: Free Trade Agreement; Free Trade Area