President Joe Biden is announcing two new efforts by the U.S. Department of Agriculture at the White House Competition Council to support what he calls “fair and competitive meat and poultry markets.”
These efforts include publishing the proposed Inclusive Competition and Market Integrity Rules Under the Packers and Stockyards Act to protect farmers and ranchers from abuse, and a new $15 million Agricultural Competition Challenge to ramp up collaboration with the state attorneys general on the enforcement of the competition laws, such as the laws against price fixing.
“Highly concentrated local markets in livestock and poultry have increasingly left farmers, ranchers, growers, and producers vulnerable to a range of practices that unjustly exclude them from economic opportunities and undermine a transparent, competitive, and open market — which harms producers’ ability to deliver the quality, affordable food working families depend upon,” said Agriculture Secretary Tom Vilsack, who is a member of the White House Competition Council. “USDA is focused on building new, fairer, and more resilient markets, protecting producers, and reducing food costs, and we are proving again today that we will use all tools at our disposal to do so.”
Proposed Rule on Inclusive Competition and Market Integrity
The USDA is proposing these modernized regulations under the Packers and Stockyards Act’s provisions prohibiting undue prejudice, unjust discrimination, and deception to provide for clearer, more effective standards to govern the modern marketplace.
The Inclusive Competition and Market Integrity proposed rule would revise regulations under the P&S Act by prohibiting certain prejudices and disadvantages against covered producers in the livestock, meat, and poultry markets. The regulations would prohibit retaliatory practices that interfere with lawful communications, assertion of rights, and participation in associations, among other protected activities — such as retaliating against a farmer or rancher for blowing the whistle on price fixing.
The regulations would also identify unlawfully deceptive practices that violate the P&S Act with respect to contract formation, contract performance, contract termination and contract refusal.
The purpose of the rule is to promote inclusive competition and market integrity in the livestock, meat, and poultry markets.
- First, the proposed rule prohibits certain prejudices and disadvantages against covered producers. Specifically, the proposed rule seeks to protect “market vulnerable individuals” who are those at heightened risk of adverse, exclusionary treatment in the marketplace, which may include on the basis of their race, gender, sexual orientation, and religious affiliation.
- Second, the proposed rule prohibits retaliatory practices that interfere with lawful communications, assertion of rights, and associational participation, among other protected activities.
- Third, the proposed rule identifies unlawfully deceptive practices that violate the P&S Act with respect to contract formation, contract performance, contract termination and contract refusal.
- Finally, the rule proposes recordkeeping requirements to support evaluation of regulated entity compliance, including the ability to inspect relevant records, such as policies and procedures, staff training and producer information materials, data and testing, board of directors’ oversight materials, and other relevant materials.
The second of three priority regulatory Packers and Stockyards Act initiatives the USDA announced it would pursue, this rule, will soon be published in the Federal Register and made available for public comment. A preview of the rule is available on the Agricultural Marketing Service website. Once published, stakeholders and other interested parties will have 60 days from the date of publication to submit comments via the web portal. All comments submitted will be considered as the USDA develops a final rule.
Agricultural Competition Challenge to the State Attorneys General
Building on the Biden-Harris Executive Order’s “Whole-of-Government” approach, the USDA is also taking action to ramp up enforcement of the competition laws by challenging the state attorneys general to partner with USDA on competition issues in the food and agriculture space, using up to $15 million in funds from the Consolidated Appropriations Act.
Through a combination of renewable cooperative agreements and memorandums of understanding, these new partnerships will assist state AGs in tackling anticompetitive practices in the agricultural sector and related industries that are contributing to heightened inflationary pressures, lack of choices for consumers and producers, and conflicts of interest and anticompetitive barriers across the food and agriculture supply chains.
Specifically, this initiative will improve state AG capacity to conduct on-the-ground investigations of competition issues, enhance coordination between Federal and state agriculture and competition enforcement authorities, create new and more independent research programs, and ultimately result in more rigorous enforcement of the competition laws.
The USDA is working directly with state AG offices to solicit applications and requests for funding under this initiative and looks forward to these partnerships as we work together to secure America’s food systems.