[Federal Register Volume 60, Number 159 (Thursday, August 17, 1995)]
[Rules and Regulations]
[Pages 42777-42779]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-20350]
-----------------------------------------------------------------------
DEPARTMENT OF AGRICULTURE
Grain Inspection, Packers and Stockyards Administration
9 CFR Parts 201 and 203
RIN 0580-AA43
Regulations and Statements of General Policy Issued Under the
Packers and Stockyards Act: Definitions, Industry Rules, Schedules of
Rates and Charges, Proceeds of Sales, Accounts and Records, Trade
Practices, Stockyard Services, Brand Inspection, and Buyers Expenses
AGENCY: Grain Inspection, Packers and Stockyards Administration, USDA.
ACTION: Final rule.
-----------------------------------------------------------------------
SUMMARY: Proposed amendments to rules issued under the Packers and
Stockyards (P&S) Act (7 U.S.C. 181 et seq.) were published in the
Federal Register (59 FR 26763) on May 24, 1994, and identified as Group
I. This document adopts proposed changes which remove two regulations
regarding posting and deposting of stockyards, amend one trade practice
regulation and retain 14 regulations and 3 statements of general policy
in their present form.
EFFECTIVE DATE: September 18, 1995.
FOR FURTHER INFORMATION CONTACT: Daniel Van Ackeren, Director,
Livestock Marketing Division (202) 720-6951, or Tommy Morris, Director,
Packer and Poultry Division (202) 720-7363.
In response to the proposed rule published in the Federal Register
(59 FR 26763), the Agency received one comment from a livestock trade
association, that commented on regulations Sec. 201.5, Sec. 201.6, and
Sec. 201.61 and statement of general policy Sec. 203.5.
The commenter concurs with the deletion of Sec. 201.5 which
pertains to Agency procedures on posting a stockyard and Sec. 201.6
which regards Agency deposting procedures. Both of these regulations
involve procedural steps taken by the Agency in posting and deposting
stockyards which are specified by the P&S Act. These two regulations
are primarily informational
[[Page 42778]]
in nature and are not necessary in carrying out the provisions of the
Act.
The commenter strongly supports modification of Sec. 201.61(a).
That subsection prohibits market agencies selling on commission from
entering into arrangements with dealers and other buyers which would
lessen their loyalty to their consignors or impair their selling
services. In addition, the subsection specifically prohibits a market
agency selling on commission from providing clearing services for an
independent dealer purchasing livestock from consignments made to that
market agency.
As proposed, Sec. 201.61(a) will be amended by modifying the last
sentence of the subsection to permit market agencies selling on
commission to provide clearing services to independent dealers that
purchase livestock from consignments to such market agencies selling on
commission, provided that full disclosure of the clearing arrangement
is noted on the accounting to the consignor. Full disclosure of the
clearing arrangement will protect livestock consignors without
unnecessarily restricting purchases from consignment and allow market
agencies selling on commission greater flexibility in representing the
interests of livestock sellers. Modifications to Sec. 201.56 published
in the Federal Register (58 FR 52884) October 13, 1993, make these
recommended changes necessary and appropriate.
As proposed, each of the following regulations and statements of
general policy will be retained in its present form:
Sec. 201.1 Meaning of words.
Sec. 201.2 Terms defined.
Sec. 201.3 Authority.
Sec. 201.4 Bylaws, rules and regulations, and requirements of
exchanges, associations, or other organizations; applicability,
establishment.
Sec. 201.17 Requirements for filing tariffs.
Sec. 201.39 Payment to be made to consignor or shipper by market
agencies; exceptions.
Sec. 201.44 Market agencies to render prompt accounting for
purchases on order.
Sec. 201.45 Market agencies to make records available for
inspection by owners, consignors and purchasers.
Sec. 201.81 Suspended registrants.
Sec. 201.82 Care and promptness in weighing and handling livestock
and live poultry.
Sec. 201.86 Brand inspection: Application for authorization,
registration, and filing of schedules, reciprocal arrangements, and
maintenance of identity of consignments.
Sec. 201.94 Information as to business; furnishing of by packers,
live poultry dealers, stockyards owners, market agencies, and
dealers.
Sec. 201.95 Inspection of business records and facilities.
Sec. 201.96 Unauthorized disclosure of business information
prohibited.
Sec. 203.5 Statement with respect to market agencies paying the
expenses of livestock buyers.
Sec. 203.12 Statement with respect to providing services and
facilities at stockyards on a reasonable and nondiscriminatory
basis.
Sec. 203.17 Statement of general policy with respect to rates and
charges at posted stockyards.
In the process of reviewing these regulations, it was determined
that they were necessary to the efficient and effective enforcement of
the P&S Act and to the orderly conduct of the marketing system. The
absence of any of the regulations would be detrimental to the industry
and could result in increased litigation.
One comment was received concerning Sec. 203.5. This statement of
general policy informs market agencies selling on commission that
paying business expenses of buyers attending their livestock sales
would be viewed as a violation of the P&S Act. The commenter disagreed
with the Agency's proposal to retain Sec. 203.5 in its present form,
stating that such payment by market agencies selling on commission of
certain minor business expenses of buyers is not in and of itself
contrary to the intent of the Act. After considering the comment, the
Agency has concluded this policy statement will be retained in its
present form. The Agency believes that market agencies selling on
commission paying the business expenses of buyers could lead to a
method of competition between similarly engaged market agencies and
result in undue and unreasonable cost burdens on such selling agencies
and the livestock producers who sell their livestock through such
market agencies. This statement of general policy correctly reflects
the Agency's policy toward such activities and the legal effect of that
policy, therefore, no changes are considered appropriate. No comments
were received concerning any of the other regulations or statements of
general policy.
The proposed change in Sec. 201.61 does not impose or change any
recordkeeping or information collection requirements. Existing
requirements in this regulation have been previously approved by OMB
under Control No. 0590-0001.
As provided by the Regulatory Flexibility Act, it is hereby
certified that this amended rule will not have a significant economic
impact on a substantial number of small entities and a statement
explaining the reasons for the certification is set forth in the
following paragraph and is being provided to the Chief Counsel for
Advocacy of the Small Business Administration.
While this amended rule impacts small entities, it will not have a
significant economic impact on any entity, large or small. The primary
effect of this rule is to remove restrictions on purchases by dealers
from consignments of a market agency that provides clearing services to
that dealer.
This amended rule has been determined to be not significant for
purposes of E.O. 12866 and therefore, has not been reviewed by OMB.
This amendment does not impose any new paperwork requirement and
does not have Federalism implications under the criteria of E.O.12612.
This amendment has been reviewed under E.O. 12778, Civil Justice
Reform, and is not intended to have retroactive effect. This amendment
will not preempt State or local laws, regulations, or policies unless
they present an irreconcilable conflict with this amendment. Prior to
judicial challenge of the amendment to rule, a party must first be
found by the Secretary to be in violation of the P&S Act and in
violation of the accompanying regulation. Second, the party must appeal
that finding and the validity of the regulation to the Secretary in the
course of the administrative proceeding. Only after taking these steps,
may the party challenge the regulation in a court of competent
jurisdiction.
List of Subjects in 9 CFR Parts 201 and 203
Rates, Records, Stockyards, Tariffs, and Trade practices.
Done at Washington, DC, this 10th day of August.
James R. Baker,
Administrator, Grain Inspection, Packers and Stockyards Administration.
For the reasons set forth in the preamble, the Grain Inspection,
Packers and Stockyards Administration will amend 9 CFR Part 201 as
follows:
1. The authority citation for part 201 continues to read as
follows:
Authority: 7 U.S.C. 204, 228; 7 CFR 2.17(e), 2.56.
PART 201--[AMENDED]
Sec. 201.5 [Removed]
2. Remove Sec. 201.5.
Sec. 201.6 [Removed]
3. Remove Sec. 201.6.
4. Revise Sec. 201.61(a) to read as follows:
[[Page 42779]]
Sec. 201.61 Market agencies selling or purchasing livestock on
commission; relationships with dealers.
(a) Market agencies selling on commission. No market agency selling
consigned livestock shall enter into any agreement, relationship or
association with dealers or other buyers which has a tendency to lessen
the loyalty of the market agency to its consignors or impair the
quality of the market agency's selling services. No market agency
selling livestock on commission shall provide clearing services for any
independent dealer who purchases livestock from consignment to such
market agency without disclosing, on the account of sale to the
consignor, the name of the buyer and the nature of the financial
relationship between the buyer and the market agency.
* * * * *
(Approved by the Office of Management and Budget under control
number 0590-0001)
[FR Doc. 95-20350 Filed 8-16-95; 8:45 am]
BILLING CODE 3410-KD-P
