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Senate Bill 3693
116th Congress(2019-2020)
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.
Introduced
Introduced
Introduced in Senate on May 12, 2020
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Introduced in Senate 
May 12, 2020
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Introduced in Senate(May 12, 2020)
May 12, 2020
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S. 3693 (Introduced-in-Senate)


116th CONGRESS
2d Session
S. 3693


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 SENATE OF THE UNITED STATES

May 12, 2020

Mr. Grassley (for himself, Mr. Tester, Ms. Ernst, Mrs. Hyde-Smith, Mr. Rounds, Ms. Smith, and Mr. Daines) introduced the following bill; which was read twice and referred to the Committee on Agriculture, Nutrition, and Forestry

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 day 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.”.