I 

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. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SPOT MARKET PURCHASES OF LIVESTOCK BY 

4 PACKERS. 

5 Chapter 5 of subtitle B of the Agricultural Marketing 

6 Act of 1946 (7 U.S.C. 1636 et seq.) is amended— 

7 (1) by redesignating section 260 (7 U.S.C. 

8 1636i) as section 261; and 


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1 (2) by inserting after section 259 the following: 

2 ‘‘SEC. 260. SPOT MARKET PURCHASES OF LIVESTOCK BY 

3 PACKERS. 

4 ‘‘(a) DEFINITIONS.—In this section: 

5 ‘‘(1) COVERED PACKER.— 

6 ‘‘(A) IN GENERAL.—The term ‘covered 

7 packer’ means a packer that is required under 

8 this subtitle to report to the Secretary each re9 porting day information on the price and quan10 tity of livestock purchased by the packer. 

11 ‘‘(B) EXCLUSION.—The term ‘covered 

12 packer’ does not include a packer that owns 

13 only 1 livestock processing plant. 

14 ‘‘(2) LIVESTOCK.—The term ‘livestock’ does not 

15 include— 

16 ‘‘(A) pork; 

17 ‘‘(B) poultry; 

18 ‘‘(C) a dairy-bred, dairy-bred cross, or beef 

19 animal over 30 months of age; or 

20 ‘‘(D) a foreign-born beef animal. 

21 ‘‘(3) NONAFFILIATED PRODUCER.—The term 

22 ‘nonaffiliated producer’ means a producer of live23 stock— 

24 ‘‘(A) that sells livestock to a packer; 


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1 ‘‘(B) that has less than 1 percent equity 

2 interest in the packer, which packer has less 

3 than 1 percent equity interest in the producer; 

4 ‘‘(C) that has no officers, directors, em5 ployees, or owners that are officers, directors, 

6 employees, or owners of the packer; 

7 ‘‘(D) that has no fiduciary responsibility to 

8 the packer; and 

9 ‘‘(E) in which the packer has no equity in10 terest. 

11 ‘‘(4) SPOT MARKET SALE.— 

12 ‘‘(A) IN GENERAL.—The term ‘spot mar13 ket sale’ means a purchase and sale of livestock 

14 by a packer from a producer— 

15 ‘‘(i) under an agreement that specifies 

16 a firm base price that may be equated with 

17 a fixed dollar amount on the date the 

18 agreement is entered into; 

19 ‘‘(ii) under which the livestock are 

20 slaughtered not more than 14 days after 

21 the date on which the agreement is entered 

22 into; and 

23 ‘‘(iii) under circumstances in which a 

24 reasonable competitive bidding opportunity 


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1 exists on the date on which the agreement 

2 is entered into. 

3 ‘‘(B) REASONABLE COMPETITIVE BIDDING

4 OPPORTUNITY.—For the purposes of subpara5 graph (A)(iii), circumstances in which a reason6 able competitive bidding opportunity shall be 

7 considered to exist if— 

8 ‘‘(i) no written or oral agreement pre9 cludes the producer from soliciting or re10 ceiving bids from other packers; and 

11 ‘‘(ii) no circumstance, custom, or 

12 practice exists that— 

13 ‘‘(I) establishes the existence of 

14 an implied contract (as determined in 

15 accordance with the Uniform Com16 mercial Code); and 

17 ‘‘(II) precludes the producer from 

18 soliciting or receiving bids from other 

19 packers. 

20 ‘‘(b) GENERAL RULE.—Of the quantity of livestock 

21 that is slaughtered by a covered packer during each re22 porting week in each plant, the covered packer shall 

23 slaughter not less than 50 percent of the quantity through 

24 spot market sales from nonaffiliated producers. 


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1 ‘‘(c) NONPREEMPTION.—Notwithstanding section 

2 259, this section does not preempt any requirement of a 

3 State or political subdivision of a State that requires a 

4 covered packer to purchase on the spot market a greater 

5 percentage of the livestock purchased by the covered pack6 er than is required under this section. 

7 ‘‘(d) RELATIONSHIP TO OTHER PROVISIONS.—Noth8 ing in this section affects the interpretation of any other 

9 provision of this Act, including section 202.’’. 

Æ 


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