U.S. Department of Agriculture:

Foreign-Owned Exporters' Participation in the Export Enhancement Program

GGD-95-127: Published: May 11, 1995. Publicly Released: May 11, 1995.

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Pursuant to a congressional request, GAO reviewed the participation of foreign-owned companies in the Foreign Agricultural Service's (FAS) Export Enhancement Program (EEP).

GAO found that: (1) foreign exporters' participation in EEP is consistent with the program's basic objectives of discouraging other countries' unfair trade practices and increasing the competitiveness of U.S. agricultural commodities; (2) exporters help achieve these objectives by facilitating U.S. agricultural product sales in targeted countries; (3) restricting foreign exporters' EEP participation could reduce the effectiveness of the program; (4) eliminating foreign-owned exporters would reduce the number of bidders for EEP bonuses, which would reduce competition and result in higher program costs; (5) it is unclear whether domestic-owned exporters could easily replace foreign-owned exporters; and (6) FAS ability to detect unauthorized diversions of EEP shipments, consisting mainly of checking exporters' documents which may be unreliable or inaccurate, will be affected by limitations in the database.

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