Source: https://www.federalregister.gov/documents/2008/02/08/E8-2376/swine-contractors
Timestamp: 2019-11-17 12:00:01
Document Index: 540604656

Matched Legal Cases: ['art 201', '§\u2009201', '§\u2009201', 'art 201', '§\u2009201', '§\u2009201', '§\u2009201', '§\u2009201']

A Proposed Rule by the Agriculture Department and the Grain Inspection, Packers and Stockyards Administration on 02/08/2008
We will consider comments we receive by April 8, 2008.
7482-7484 (3 pages)
https://www.federalregister.gov/d/E8-2376 https://www.federalregister.gov/d/E8-2376
Start Preamble Start Printed Page 7482
We propose to add “swine contractors” to the list of regulated entities subject to specific regulations under the Packers and Stockyards Act (the P&S Act). In 2002, Congress added swine contractors as entities regulated under the P&S Act. The specific regulations we propose to amend prohibit regulated entities from circulating misleading reports about market conditions or prices. We also propose to amend regulations that address inspection of business records and facilities, information that regulated entities are required to share with the Secretary of Agriculture, and USDA's responsibility to refrain from unauthorized disclosure of that information. The goal of these regulations is to ensure fairness in the marketing of livestock, meat, and poultry. Adding swine contractors to specific regulations under the P&S Act will assist swine contractors and swine production contract growers with determining which regulations apply to them. Adding swine contractors to specific regulations will also make it easier for GIPSA to identify potential violations and to enforce the provisions of the P&S Act and regulations.
Read Comments: All comments will be available for public inspection in the above office during regular business hours (7 CFR 1.27(b)). Please call the GIPSA Management Support Services staff at (202) 720-7486 to arrange a public inspection of comments.
The Farm Security and Rural Investment Act of 2002 (Pub. L. 107-171) amended the P&S Act to define and add “swine contractors” as a regulated entity. A swine contractor is defined as “any person engaged in the business of obtaining swine under a swine production contract for the purpose of slaughtering the swine or selling the swine for slaughter, if (A) the swine is obtained by the person in commerce; or (B) the swine (including products from the swine) obtained by the person is sold or shipped in commerce.” ((7 U.S.C. 182 (12))
We now propose to amend the following regulations (9 CFR part 201) under the P&S Act to add the words “swine contractors” to the list of those subject to the regulations:
Section 201.53 Persons subject to the Act not to circulate misleading reports about market conditions or prices.
Section 201.94 Information as to business; furnishing of by packers, live poultry dealers, stockyard owners, market agencies, and dealers.
Section 201.95 Inspection of business records and facilities.
Section 201.96 Unauthorized disclosure of business information prohibited.
The proposed modification to § 201.53 would inform swine contractors that they are prohibited from knowingly making, issuing, or circulating false or misleading reports, records, or representations about market conditions, about prices, or about the sale of livestock, meat, or live poultry. The proposed modification to § 201.94 would require swine contractors to furnish the Secretary or his duly authorized representatives, if requested by such representatives, with business information required in order to carry out provisions of the P&S Act and regulations in 9 CFR part 201. The proposed modification to § 201.95 would require swine contractors to permit authorized representatives of the Secretary to enter their places of business to examine and copy business records, and to inspect facilities. The proposed modification to § 201.96 would prohibit agents or employees of the United States from disclosing a swine contractor's business information without the consent of the swine contractor, except in the specific circumstances listed in § 201.96. Start Printed Page 7483
We considered not making these regulatory changes and continuing to protect the interests of swine producers indirectly through regulation of packers, dealers, and market agents. However, that option would not reflect the intent of Congress in amending the P&S Act to give the Secretary authority over swine contractors. We have the authority and the responsibility to directly regulate swine contractors. We could also take legal action against a swine contractor for alleged violations of the P&S Act without amending the regulations. However, that action would not clearly inform all swine contractors and swine production contract growers about the requirements that apply to swine contractors. Issuing the proposed regulations would make it clear to swine contractors and swine production contract growers which parts of the regulations apply to them, and would make it easier for GIPSA to identify potential violators and to enforce provisions of the P&S Act.
If we implement these regulatory changes, swine contractors will have to open their business records and facilities to authorized representatives of GIPSA upon request. Some swine contractors may have to change their policies to allow access and to accommodate GIPSA representatives. We are not requiring that new information or records be kept by swine contractors, unless existing information or records are false or misleading about market conditions, prices, or sales of livestock, meat, or live poultry. This proposed rule would give swine contractors assurance that business information examined by GIPSA will be kept confidential, except under specific circumstances. Furthermore, swine production contract growers will be given increased assurance of fair treatment by swine contractors.
We have determined that this proposed rule will not have a significant economic impact on a substantial number of small entities as defined in the Regulatory Flexibility Act (5 U.S.C. 601, et seq.). The proposed rule will affect swine contractors. Most of these entities are slaughterers or processors of swine with more than 500 employees and do not meet the applicable size standards for small entities in the Small Business Administration Regulations (13 CFR 121.201). A 2007 study of U.S. pork producers found that firms that market more than 50,000 head of swine per year account for nearly all of contracted swine production in the U.S.
In accordance with 5 U.S.C. 605 of the Regulatory Flexibility Act, we are not providing an initial regulatory flexibility analysis because this proposed rule, if promulgated, will not have a significant economic impact on a substantial number of small entities.
Small swine production contract growers should benefit indirectly from the proposed amendments, which should provide fairness in the marketing of swine and swine products.
3. Revise § 201.94 to revise the heading and to read as follows:
Each packer, swine contractor, live poultry dealer, stockyard owner, market agency, and dealer, upon proper request, shall give to the Secretary or his duly authorized representatives in writing or otherwise, and under oath or affirmation if requested by such representatives, any information concerning the business of the packer, swine contractor, live poultry dealer, stockyard owner, market agency, or dealer, or which may be required in order to carry out the provisions of the Act and regulations in this part within such reasonable time as may be specified in the request for such information.
Each stockyard owner, market agency, dealer, packer, swine contractor, and live poultry dealer, upon proper request, shall permit authorized representatives of the Secretary to enter its place of business during normal business hours and to examine records pertaining to its business subject to the Act, to make copies thereof and to inspect the facilities of such persons subject to the Act. Reasonable accommodations shall be made available to authorized representatives of the Secretary by the stockyard owner, market agency, dealer, packer, swine contractor, or live poultry dealer for such examination of records and inspection of facilities. Start Printed Page 7484
[FR Doc. E8-2376 Filed 2-7-08; 8:45 am]