I 
107TH CONGRESS 
2D SESSION 
H. R. 5357
To provide for the review of agriculture mergers and acquisitions by the 
Department of Agriculture and to outlaw unfair practices in the agri-
culture industry, and for other purposes. 
IN THE HOUSE OF REPRESENTATIVES 
SEPTEMBER 10, 2002
Mr. BEREUTER introduced the following bill; which was referred to the Com-
mittee on Agriculture, and in addition to the Committee on the Judiciary, 
for a period to be subsequently determined by the Speaker, in each case 
for consideration of such provisions as fall within the jurisdiction of the 
committee concerned 
A BILL 
To provide for the review of agriculture mergers and acquisi-
tions by the Department of Agriculture and to outlaw 
unfair practices in the agriculture industry, and for other 
purposes.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE. 
This Act may be cited as the ‘‘Agriculture Competi-
tion Enhancement Act’’. 
SEC. 2. DEFINITIONS. 
In this Act:
(6) COMMISSION MERCHANT.—The term ‘‘com-
mission merchant’’ means any person (excluding ag-
ricultural cooperatives) engaged in the business of 
receiving in commerce any agricultural commodity 
for sale, on commission, or for or on behalf of an-
other. 
(7) DEALER.—The term ‘‘dealer’’ means any 
person (excluding agricultural cooperatives) engaged 
in the business of buying, selling, or marketing agri-
cultural commodities in commerce, except that no 
person shall be considered a dealer with respect to 
sales or marketing of any agricultural commodity of 
that person’s own raising. 
(8) PROCESSOR.—The term ‘‘processor’’ means 
any person (excluding agricultural cooperatives) en-
gaged in the business of handling, preparing, or 
manufacturing (including slaughtering) of an agri-
cultural commodity, or the products of such agricul-
tural commodity, for sale or marketing in commerce 
for human consumption but not with respect to sale 
or marketing at the retail level. 
(9) SECRETARY.—The term ‘‘Secretary’’ means 
the Secretary of Agriculture.
(10) SPECIAL
COUNSEL.—The term ‘‘Special 
Counsel’’ means the Special Counsel for Competition 
Matters at the Department of Agriculture. 
SEC. 3. SPECIAL COUNSEL FOR COMPETITION MATTERS. 
(a) IN GENERAL.—There shall be established within 
the Department of Agriculture a Special Counsel for Com-
petition Matters whose primary responsibilities shall be 
to—
(1) analyze mergers within the food and agri-
cultural sectors, in consultation with the Chief Econ-
omist of the Department of Agriculture, as required 
by section 4; and 
(2) assure that section 5, and the Packers and 
Stockyards Act and related authorities, are enforced 
appropriately. 
(b) APPOINTMENT.—The Special Counsel for Com-
petition Matters shall be appointed by the President sub-
ject to the advice and consent of the Senate. 
(c) 
PROSECUTORIAL
AUTHORITY.—The 
Special 
Counsel for Competition Matters shall have the authority 
to bring any civil action authorized pursuant to this Act 
on behalf of the United States.
SEC. 4. AGRIBUSINESS MERGER REVIEW AND ENFORCE-
MENT 
BY 
THE 
DEPARTMENT 
OF 
AGRI-
CULTURE. 
(a) NOTICE
OF FILING.—The Assistant Attorney 
General or the Federal Trade Commission, as appropriate, 
shall notify the Secretary of Agriculture of any filing pur-
suant to section 7A of the Clayton Act (15 U.S.C. 18a) 
involving a merger or acquisition described in subsection 
(b)(1), and shall give the Secretary of Agriculture the op-
portunity to participate in the review proceedings. 
(b) SPECIAL COUNSEL REVIEW.—
(1) IN GENERAL.—In addition to the antitrust 
review conducted by the Federal Trade Commission 
or Assistant Attorney General pursuant to section 
7A of the Clayton Act (15 U.S.C. 18a), and notwith-
standing any participation in those antitrust review 
proceedings, the Special Counsel for Competition 
Matters, in consultation with the Chief Economist of 
the Department of Agriculture, shall, contempora-
neously, observing the time period limitations pro-
vided under the antitrust laws and the Department 
of Justice merger guidelines, and utilizing the fac-
tors set forth in subsection (d), review, to determine 
whether the proposed transaction would cause sub-
stantial harm to the ability of independent producers
and family farmers to compete in the marketplace, 
any merger or acquisition involving— 
(A) a dealer, processor, commission mer-
chant, agricultural input supplier, broker, or 
operator of a warehouse of agricultural com-
modities with annual net sales or total assets of 
more than $100,000,000 merging or acquiring,
directly or indirectly, any voting securities or 
assets of any other dealer, processor, commis-
sion merchant, agricultural input supplier, 
broker, or operator of a warehouse of agricul-
tural commodities with annual net sales or total 
assets of more than $10,000,000; or 
(B) a dealer, processor, commission mer-
chant, agricultural input supplier, broker, or 
operator of a warehouse of agricultural com-
modities with annual net sales or total assets of 
more than $10,000,000 merging or acquiring, 
directly or indirectly, any voting securities or 
assets of any other dealer, processor, commis-
sion merchant, agricultural input supplier, 
broker, or operator of a warehouse of agricul-
tural commodities with annual net sales or total 
assets of more than $100,000,000 if the acquir-
ing person would hold—
(i) 15 percent or more of the voting 
securities or assets of the acquired person; 
or 
(ii) an aggregate total amount of the 
voting securities and assets of the acquired 
person in excess of $15,000,000. 
(2) EXCEPTION.—The Special Counsel for 
Competition Matters, at his or her discretion, may 
also request that the Assistant Attorney General or 
the Federal Trade Commission require section 7A of 
the Clayton Act (15 U.S.C. 18a) notification of an 
agriculture merger or acquisition of a size smaller 
than is required under paragraph (1), if the Special 
Counsel for Competition Matters believes that such 
transaction will cause substantial harm to the ability 
of independent producers and family farmers to 
compete in the market. 
(c) NOTIFICATION ON FAILURE TO PROCEED.—If 
the Assistant Attorney General or the Federal Trade Com-
mission determines not to proceed against the parties of 
an agriculture merger or acquisition under the antitrust 
laws, the Assistant Attorney General or the Federal Trade 
Commission immediately shall notify the Special Counsel 
for Competition Matters of such decision. 
(d) STANDARD OF REVIEW.—
(1) IN
GENERAL.—The Special Counsel for 
Competition Matters, in consultation with the Chief 
Economist of the Department of Agriculture, shall 
review, and may challenge, a merger or acquisition 
described in subsection (b) based on whether the 
merger or acquisition would cause substantial harm 
to the ability of independent producers and family 
farmers to compete in the marketplace. 
(2) FACTORS.—The review shall consider, 
among other factors—
(A) the effect of the acquisition or merger 
on prices paid to producers who sell to, buy 
from, or bargain with, one or more of the par-
ties involved in the merger or acquisition; 
(B) the likelihood that the acquisition or 
merger will result in significantly increased 
market power for the new or surviving entity; 
(C) the likelihood that the acquisition or 
merger will increase the potential for anti-
competitive or predatory conduct by the new or 
surviving entity; and 
(D) whether the acquisition or merger will 
adversely affect producers in a particular re-
gional area, including an area as small as a sin-
gle State.
(e) EVIDENTIARY POWERS.—The Special Counsel for 
Competition Matters shall have the same powers as pos-
sessed by the Assistant Attorney General and the Federal 
Trade Commission under the antitrust laws, to obtain evi-
dence necessary to make determinations for the review de-
scribed in subsection (b). 
(f) ACCESS TO ATTORNEY GENERAL AND FEDERAL 
TRADE COMMISSION INFORMATION.—The Assistant At-
torney General or the Federal Trade Commission, as ap-
propriate, shall make available to the Special Counsel for 
Competition Matters any information, including any testi-
mony, documentary material, or related information rel-
evant to the review conducted by the Special Counsel 
under this section which is under the control of the Assist-
ant Attorney General or the Federal Trade Commission. 
Each agency will share information, consistent with appli-
cable confidentiality restrictions, in order to provide the 
others with information believed to be potentially relevant 
and useful to the others’ enforcement responsibilities. 
Such information may include legal, economic, and tech-
nical assistance. 
(g) TRANSMITTAL OF FINDINGS OF SPECIAL COUN-
SEL FOR COMPETITION MATTERS.—After receiving notice 
pursuant to subsection (a) and conducting the review re-
quired in subsection (b), the Secretary of Agriculture shall
report to the Assistant Attorney General or the Federal 
Trade Commission, as appropriate, and the parties, the 
findings of the review, including any recommended condi-
tions on the merger or suggested remedies. 
(h) RESPONSE TO SPECIAL COUNSEL FINDINGS.—
(1) ANTITRUST AGENCY RESPONSE TO FIND-
INGS.—The Assistant Attorney General or the Fed-
eral Trade Commission, as appropriate, shall provide 
the Special Counsel for Competition Matters a re-
sponse, including the rationale as to why such find-
ings and recommendations are accepted or rejected. 
(2) PARTY OPPORTUNITY TO ADDRESS FIND-
INGS.—The parties to the merger or acquisition af-
fected by such findings shall have the opportunity to 
make changes to their operations or structure, and 
to negotiate with the Special Counsel for Competi-
tion Matters an acceptable resolution to any con-
cerns raised in the findings. 
(i) ENFORCEMENT.—
(1) JUDICIAL ACTION.—Not later than 30 days 
after notification by the Assistant Attorney General 
or the Federal Trade Commission of their deter-
mination not to proceed against the parties, the Spe-
cial Counsel for Competition Matters, if he or she is 
not satisfied with the review of, or the conditions
placed on, the merger or acquisition by the Assistant 
Attorney General or the Federal Trade Commission, 
may challenge the transaction in Federal court 
based on the findings conducted in the review under 
this section.
(2) ENFORCEMENT
AND
DAMAGES.—The en-
forcement and damage provisions of the antitrust 
laws shall apply with respect to a violation of the 
substantial harm to producers and family farmers 
standard of subsection (d) in the same manner as 
such sections apply with respect to a violation of the 
antitrust laws. 
(j) CONFORMING
AMENDMENTS
TO
ANTITRUST 
LAWS.—Section 7A of the Clayton Act (15 U.S.C. 18a) 
is amended by inserting at the end the following: 
‘‘(k)(1) Notwithstanding the threshold requirements 
of sections 1, 2, and 3, the Federal Trade Commission 
and the Assistant Attorney General may require, at the 
request of the Secretary of Agriculture, notification pursu-
ant to the rules under subsection (d)(1) from the parties 
to a proposed merger or acquisition in the agriculture in-
dustry. 
‘‘(2) The Assistant Attorney General or the Federal 
Trade Commission, as appropriate, shall give the Sec-
retary of Agriculture the opportunity to participate in the
review under the antitrust laws of any proposed merger 
or acquisition involving the agriculture industry.’’. 
SEC. 5. PROHIBITIONS AGAINST UNFAIR PRACTICES IN 
TRANSACTIONS INVOLVING AGRICULTURAL 
COMMODITIES AND ENFORCEMENT. 
(a) UNLAWFUL PRACTICES.—It shall be unlawful for 
any dealer, processor, commission merchant, or broker of 
any agricultural commodity to—
(1) engage in or use any unfair, unjustly dis-
criminatory, or deceptive practice or device; 
(2) make or give any undue or unreasonable 
preference or advantage to any particular person or 
locality in any respect whatsoever, or subject any 
particular person or locality to any undue or unrea-
sonable prejudice or disadvantage; 
(3) sell or otherwise transfer to or for any other 
dealer, processor, commission merchant, or broker, 
or buy or otherwise receive from or for any other 
dealer, processor, commission merchant, or broker, 
any article for the purpose or with the effect of ap-
portioning the supply between any such persons, if 
such apportionment has the tendency or effect of re-
straining commerce or of creating a monopoly; 
(4) sell or otherwise transfer to or for any other 
person, or buy or otherwise receive from or for any
other person, any article for the purpose or with the 
effect of manipulating or controlling prices, or of 
creating a monopoly in the acquisition of, buying, 
selling, or dealing in, any article, or of restraining 
commerce; 
(5) engage in any course of business or do any 
act for the purpose or with the effect of manipu-
lating or controlling prices, or of creating a monop-
oly in the acquisition of, buying, selling, or dealing 
in, any article, or of restraining commerce; 
(6) conspire, combine, agree, or arrange with 
any other person—
(A) to apportion territory for carrying on 
business; 
(B) to apportion purchases or sales of any 
article; or 
(C) to manipulate or control prices; or 
(7) conspire, combine, agree, or arrange with 
any other person to do, or aid or abet the doing of, 
any act made unlawful by paragraph (1), (2), (3), 
(4), or (5). 
(b) PROCEDURE BEFORE SECRETARY FOR VIOLA-
TIONS.—
(1) COMPLAINT; HEARING; INTERVENTION.—If 
the Secretary has reason to believe that any dealer,
(2) REPORT AND ORDER; PENALTY.—If, after 
such hearing, the Secretary finds that the dealer, 
processor, commission merchant, or broker, has vio-
lated or is violating any provisions of this section 
covered by the charges, the Secretary shall make a 
report in writing in which the Secretary shall state 
his findings as to the facts, and shall issue and 
cause to be served on the dealer, processor, commis-
sion merchant, or broker, an order requiring such 
dealer, processor, commission merchant, or broker, 
to cease and desist from continuing such violation. 
The testimony taken at the hearing shall be reduced 
to writing and filed in the records of the Depart-
ment of Agriculture. The Secretary may also assess 
a civil penalty of not more than $10,000 for each 
such violation. In determining the amount of the 
civil penalty to be assessed under this section, the 
Secretary shall consider the gravity of the offense, 
the size of the business involved, and the effect of 
the penalty on the person’s ability to continue in 
business. If, after the lapse of the period allowed for 
appeal or after the affirmance of such penalty, the 
person against whom the civil penalty is assessed 
fails to pay such penalty, the Secretary may proceed
to recover such penalty by an action in the appro-
priate district court of the United States. 
(3) AMENDMENT OF REPORT OR ORDER.—Until 
the record in such hearing has been filed in a court 
of appeals of the United States, as provided in sub-
section (c), the Secretary at any time, upon such no-
tice and in such manner as the Secretary deems 
proper, but only after reasonable opportunity to the 
dealer, processor, commission merchant, or broker, 
to be heard, may amend or set aside the report or 
order, in whole or in part. 
(4) SERVICE OF PROCESS.—Complaints, orders, 
and other processes of the Secretary under this sec-
tion may be served in the same manner as provided 
in section 5 of the Federal Trade Commission Act 
(15 U.S.C. 45). 
(c) CONCLUSIVENESS OF ORDER; APPEAL AND RE-
VIEW.—
(1) FILING
OF
PETITION; BOND.—An order 
made under subsection (b) shall be final and conclu-
sive unless within 30 days after service the dealer, 
processor, commission merchant, or broker, appeals 
to the court of appeals for the circuit in which he 
has his principal place of business, by filing with the 
clerk of such court a written petition praying that
the Secretary’s order be set aside or modified in the 
manner stated in the petition, together with a bond 
in such sum as the court may determine, conditioned 
that such dealer, processor, commission merchant, or 
broker, will pay the costs of the proceedings if the 
court so directs. 
(2) FILING OF RECORD BY SECRETARY.—The 
clerk of the court shall immediately cause a copy of 
the petition to be delivered to the Secretary, and the 
Secretary shall thereupon file in the court the record 
in such proceedings, as provided in section 2112 of 
title 28, United States Code. If before such record 
is filed the Secretary amends or sets aside his report 
or order, in whole or in part, the petitioner may 
amend the petition within such time as the court 
may determine, on notice to the Secretary. 
(3) TEMPORARY
INJUNCTION.—At any time 
after such petition is filed, the court, on application 
of the Secretary, may issue a temporary injunction, 
restraining, to the extent it deems proper, the deal-
er, processor, commission merchant, or broker, and 
his officers, directors, agents, and employees, from 
violating any of the provisions of the order pending 
the final determination of the appeal.
(4) EVIDENCE.—The evidence so taken or ad-
mitted, and filed as aforesaid as a part of the 
record, shall be considered by the court as the evi-
dence in the case. 
(5) ACTION BY THE COURT.—The court may 
affirm, modify, or set aside the order of the Sec-
retary. 
(6) ADDITIONAL EVIDENCE.—If the court de-
termines that the just and proper disposition of the 
case requires the taking of additional evidence, the 
court shall order the hearing to be reopened for the 
taking of such evidence, in such manner and upon 
such terms and conditions as the court may deem 
proper. The Secretary may modify his findings as to 
the facts, or make new findings, by reason of the ad-
ditional evidence so taken, and the Secretary shall 
file such modified or new findings and his rec-
ommendations, if any, for the modifications or set-
ting aside of his order, with the return of such addi-
tional evidence. 
(7) INJUNCTION.—If the court of appeals af-
firms or modifies the order of the Secretary, its de-
cree shall operate as an injunction to restrain the 
dealer, processor, commission merchant, or broker, 
and his officers, directors, agents, and employees
from violating the provisions of such order or such 
order as modified. 
(8) FINALITY.—The court of appeals shall have 
jurisdiction, which upon the filing of the record with 
it shall be exclusive, to review, and to affirm, set 
aside, or modify, such orders of the Secretary, and 
the decree of such court shall be final except that it 
shall be subject to review by the Supreme Court of 
the United States upon certiorari, as provided in 
section 1254 of title 28, United States Code, if such 
writ is duly applied for within 60 days after entry 
of the decree. The issue of such writ shall not oper-
ate as a stay of the decree of the court of appeals, 
insofar as such decree operates as an injunction un-
less so ordered by the Supreme Court. 
(d) PUNISHMENT FOR VIOLATION OF ORDER.—Any 
dealer, processor, commission merchant, or broker, or any 
officer, director, agent, or employee of a dealer, processor, 
commission merchant, or broker, who fails to obey any 
order of the Secretary issued under the provisions of sub-
section (b), or such order as modified—
(1) after the expiration of the time allowed for 
filing a petition in the court of appeals to set aside 
or modify such order, if no such petition has been 
filed within such time;
(2) after the expiration of the time allowed for 
applying for a writ of certiorari, if such order, or 
such order as modified, has been sustained by the
court of appeals and no such writ has been applied 
for within such time; or 
(3) after such order, or such order as modified, 
has been sustained by the courts as provided in sub-
section (c); 
shall on conviction be fined not less than $500 nor more 
than $10,000, or imprisoned for not less than 6 months 
nor more than 5 years, or both. Each day during which 
such failure continues shall be deemed a separate offense. 
SEC. 6. REPORT ON CORPORATE STRUCTURE. 
A dealer, processor, commission merchant, or broker 
with annual sales in excess of $100,000,000 shall annually 
file with the Secretary a report which describes, with re-
spect to both domestic and foreign activities, the strategic 
alliances, ownership in other agribusiness firms or agri-
business-related firms, joint ventures, subsidiaries, and 
brand names, interlocking boards of directors with other 
corporations, representatives, and agents that lobby Con-
gress on behalf of such dealer, processor, commission mer-
chant, or broker, as determined by the Secretary.
SEC. 7. PROHIBITION ON CONFIDENTIALITY CLAUSES IN 
LIVESTOCK 
AND 
POULTRY 
PRODUCTION 
CONTRACTS. 
Confidentiality clauses barring a party to a contract 
from sharing terms of such contract for the purposes of 
obtaining legal or financial advice, are prohibited in live-
stock production contracts and grain production contracts 
(except to the extent a legitimate trade secret (as applied 
in the Freedom of Information Act, 5 U.S.C. 552 et seq.) 
is being protected). 
SEC. 8. AUTHORITY TO MAKE BUSINESS AND INDUSTRY 
GUARANTEED LOANS FOR FARMER-OWNED 
PROJECTS THAT ADD VALUE TO OR PROCESS 
AGRICULTURAL PRODUCTS. 
Section 310B(a)(1) of the Consolidated Farm and 
Rural Development Act (7 U.S.C. 1932(a)(1)) is amended 
by inserting ‘‘(and in areas other than rural communities, 
in the case of insured loans, if a majority of the project 
involved is owned by individuals who reside and have farm-
ing operations in rural communities, and the project adds 
value to or processes agricultural commodities)’’ after 
‘‘rural communities’’.
SEC. 9. AUTHORIZATION FOR ADDITIONAL STAFF AND 
FUNDING FOR AGRICULTURE COMPETITION 
ENFORCEMENT. 
(a) ADDITIONAL STAFF.—The Secretary of Agri-
culture shall hire sufficient staff, including antitrust and 
litigation attorneys, economists, and investigators, to ap-
propriately carry out the agribusiness merger review and 
prohibition against unfair practices responsibilities, de-
scribed in sections 4 and 5. 
(b) AUTHORIZATION.—There are authorized to be ap-
propriated such sums as are necessary to hire the staff 
referenced in subsection (a) to implement this Act. 
SEC. 10. AUTHORIZATION FOR ADDITIONAL STAFF AND 
FUNDING 
FOR 
THE 
GRAIN 
INSPECTION, 
PACKERS AND STOCKYARDS ADMINISTRA-
TION. 
There are authorized to be appropriated such sums 
as are necessary to enhance the capability of the Grain 
Inspection, Packers and Stockyards Administration to 
monitor, investigate, and pursue the competitive implica-
tions of structural changes in the meat packing industry. 
Sums are specifically earmarked to hire litigating attor-
neys to allow the Grain Inspection, Packers and Stock-
yards Administration to more comprehensively and effec-
tively pursue its enforcement activities.
SEC. 11. ASSISTANT ATTORNEY GENERAL FOR AGRICUL-
TURAL ANTITRUST MATTERS. 
(a) IN GENERAL.—There shall be established within 
the Antitrust Division of the Department of Justice an 
Assistant Attorney General for Agricultural Antitrust 
Matters, who shall be responsible for oversight and coordi-
nation of antitrust and related matters which affect agri-
culture, directly or indirectly. 
(b) APPOINTMENT.—The Assistant Attorney General 
for Agricultural Antitrust Matters shall be appointed by 
the President subject to the advice and consent of the Sen-
ate. 
SEC. 12. INCREASE IN HART-SCOTT-RODINO FILING FEES. 
(a) IN GENERAL.—The filing fee the Federal Trade 
Commission assesses on a person acquiring voting securi-
ties or assets who is required to file premerger notifica-
tions under section 7A of the Clayton Act (15 U.S.C. 18a) 
for mergers and acquisitions satisfying the $15,000,000 
size-of-transaction requirement is increased to $100,000 
for those transactions valued at more than $100,000,000. 
(b) FEES EARMARKED.—The filing fee increase de-
scribed in subsection (a) is partially earmarked to pay for 
the costs of staff increases at the Transportation, Energy 
and Agriculture section at the Department of Justice, as
considered necessary by the Assistant Attorney General, 
to enhance their review of agriculture transactions.
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