[Code of Federal Regulations]
[Title 9, Volume 2]
[Revised as of January 1, 2003]
From the U.S. Government Printing Office via GPO Access
[CITE: 9CFR203.19]

[Page 59]
 
                  TITLE 9--ANIMALS AND ANIMAL PRODUCTS
 
  CHAPTER II--GRAIN INSPECTION, PACKERS AND STOCKYARDS ADMINISTRATION 
       (PACKERS AND STOCKYARDS PROGRAMS),DEPARTMENT OF AGRICULTURE
 
PART 203--STATEMENTS OF GENERAL POLICY UNDER THE PACKERS AND STOCKYARDS ACT--Table of Contents
 
Sec. 203.19  Statement with respect to packers engaging in the business of livestock dealers or buying agencies.

    (a) In its administration of the Packers and Stockyards Act, the 
Grain Inspection, Packers and Stockyards Administration (Packers and 
Stockyards Programs) has sought to prevent conflicts of interest and to 
maintain open and fair competition in the livestock and meat packing 
industries. The ownership or operation of livestock dealers or buying 
agencies by packers, under some circumstances, may result in violations 
of the Packers and Stockyards Act.
    (b) Traditionally, livestock dealers and buying agencies purchase 
livestock for resale or to fill orders for farmers, ranchers, producers, 
other livestock firms and packers. When a livestock dealer or buying 
agency is owned or operated by a packer, and when such packer is also 
buying livestock for its own operational requirements, there is a 
potential conflict of interest. Furthermore, the purchase and sale of 
livestock by meat packers may result in control of markets and prices 
which could adversely affect both livestock producers, competing 
packers, and consumers.
    (c) Arrangements between packers and dealers or buying agencies 
which do not normally create a conflict of interest or result in a 
restraint of competition include:
    (1) Operations utilizing different species or classes of livestock; 
(2) operations where the business activities are widely separated 
geographically; and (3) operations where tie-in purchases or sales are 
not involved. Packers contemplating engaging in the business of a 
livestock dealer or a buying agency are encouraged to consult with the 
Grain Inspection, Packers and Stockyards Administration (Packers and 
Stockyards Programs) prior to the commencement of such activities.
    (d) In the event a packer/dealer or a packer/buying agency 
arrangement appears to give rise to a violation of the Act, an 
investigation will be made on a case-by-case basis and, where warranted, 
appropriate action will be taken.

(Approved by the Office of Management and Budget under control number 
0590-0001)

(7 U.S.C. 228, 228b, 222, 15 U.S.C. 46)

[49 FR 32845, Aug. 17, 1984; 54 FR 26349, June 23, 1989]