This bill establishes that a minimum of 50% of a covered packer's weekly volume of livestock slaughter must be purchased through spot market sales from nonaffiliated producers. (The term covered packer applies to a packer that is required to report to the Department of Agriculture each reporting day information on the price and quantity of livestock purchased by such packer and does not include a packer that owns only one livestock processing plant.)
A spot market sale is a purchase and sale of livestock by a packer from a producer under (1) an agreement that specifies a firm base price that may be equated with a fixed dollar amount on the date the agreement is entered into, (2) which the livestock are slaughtered not more than 14 days after the date on which the agreement is entered into, and (3) circumstances in which a reasonable competitive bidding opportunity exists on the date on which the agreement is entered into.
[Congressional Bills 116th Congress]
[From the U.S. Government Publishing Office]
[H.R. 7501 Introduced in House (IH)]
<DOC>
116th CONGRESS
2d Session
H. R. 7501
To amend the Agricultural Marketing Act of 1946 to foster efficient
markets and increase competition and transparency among packers that
purchase livestock from producers.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
July 9, 2020
Mrs. Axne (for herself, Ms. Finkenauer, and Mr. Loebsack) introduced
the following bill; which was referred to the Committee on Agriculture
_______________________________________________________________________
A BILL
To amend the Agricultural Marketing Act of 1946 to foster efficient
markets and increase competition and transparency among packers that
purchase livestock from producers.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SPOT MARKET PURCHASES OF LIVESTOCK BY PACKERS.
Chapter 5 of subtitle B of the Agricultural Marketing Act of 1946
(7 U.S.C. 1636 et seq.) is amended--
(1) by redesignating section 260 (7 U.S.C. 1636i) as
section 261; and
(2) by inserting after section 259 the following:
``SEC. 260. SPOT MARKET PURCHASES OF LIVESTOCK BY PACKERS.
``(a) Definitions.--In this section:
``(1) Covered packer.--
``(A) In general.--The term `covered packer' means
a packer that is required under this subtitle to report
to the Secretary each reporting day information on the
price and quantity of livestock purchased by the
packer.
``(B) Exclusion.--The term `covered packer' does
not include a packer that owns only 1 livestock
processing plant.
``(2) Livestock.--The term `livestock' does not include--
``(A) pork;
``(B) poultry;
``(C) a dairy-bred, dairy-bred cross, or beef
animal over 30 months of age; or
``(D) a foreign-born beef animal.
``(3) Nonaffiliated producer.--The term `nonaffiliated
producer' means a producer of livestock--
``(A) that sells livestock to a packer;
``(B) that has less than 1 percent equity interest
in the packer, which packer has less than 1 percent
equity interest in the producer;
``(C) that has no officers, directors, employees,
or owners that are officers, directors, employees, or
owners of the packer;
``(D) that has no fiduciary responsibility to the
packer; and
``(E) in which the packer has no equity interest.
``(4) Spot market sale.--
``(A) In general.--The term `spot market sale'
means a purchase and sale of livestock by a packer from
a producer--
``(i) under an agreement that specifies a
firm base price that may be equated with a
fixed dollar amount on the date the agreement
is entered into;
``(ii) under which the livestock are
slaughtered not more than 14 days after the
date on which the agreement is entered into;
and
``(iii) under circumstances in which a
reasonable competitive bidding opportunity
exists on the date on which the agreement is
entered into.
``(B) Reasonable competitive bidding opportunity.--
For the purposes of subparagraph (A)(iii),
circumstances in which a reasonable competitive bidding
opportunity shall be considered to exist if--
``(i) no written or oral agreement
precludes the producer from soliciting or
receiving bids from other packers; and
``(ii) no circumstance, custom, or practice
exists that--
``(I) establishes the existence of
an implied contract (as determined in
accordance with the Uniform Commercial
Code); and
``(II) precludes the producer from
soliciting or receiving bids from other
packers.
``(b) General Rule.--Of the quantity of livestock that is
slaughtered by a covered packer during each reporting week in each
plant, the covered packer shall slaughter not less than 50 percent of
the quantity through spot market sales from nonaffiliated producers.
``(c) Nonpreemption.--Notwithstanding section 259, this section
does not preempt any requirement of a State or political subdivision of
a State that requires a covered packer to purchase on the spot market a
greater percentage of the livestock purchased by the covered packer
than is required under this section.
``(d) Relationship to Other Provisions.--Nothing in this section
affects the interpretation of any other provision of this Act,
including section 202.''.
<all>
Introduced in House
Introduced in House
Referred to the House Committee on Agriculture.
Referred to the Subcommittee on Livestock and Foreign Agriculture.
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