The Meat Institute voiced its opposition on September 11 regarding the new Fair and Competitive Livestock and Poultry Markets rule proposed by the Agricultural Marketing Service (AMS), a division of the US Department of Agriculture (USDA).
The trade association contends that the proposed rule seeks to bypass both Congress and the judicial system in an effort to change a well-established legal precedent. According to the Meat Institute, the current standard under Section 202(a) and (b) of the Packers and Stockyards Act requires plaintiffs to prove harm to competition in order to bring a successful lawsuit. The association argues that the USDA’s attempt to alter this is not only misguided but unlawful.
The association also expressed concern that the proposed rule infringes on constitutional principles and violates the Administrative Procedure Act. Dopp further argued that any alteration to the “harm to competition” standard should come from Congress, as supported by the Supreme Court’s decision in West Virginia v. EPA.
Economic Concerns and Legal Ramifications
Another critical point raised by the Meat Institute was the lack of an adequate economic analysis for the proposed rule. Dopp criticized the AMS for failing to provide a thorough assessment, stating that while the agency acknowledged the difficulty of quantifying the rule’s financial impact, it should not have been an excuse to skip the analysis altogether.
In addition, the Meat Institute questioned the USDA’s failure to estimate the legal costs businesses would incur if the rule is finalized, emphasizing that the consequences of increased litigation could ripple throughout the industry.
USDA’s Stance on Market Power
When the USDA initially introduced the proposed rule in June, Secretary of Agriculture Tom Vilsack emphasized the need to address what he called “entrenched market power” in the livestock and poultry industries. Vilsack stated that such power prevents fair competition and drives up prices for consumers while disadvantaging producers.
To give stakeholders more time to respond, the AMS extended the public comment period from its original August 27 deadline to September 11.
In light of the Meat Institute’s strong opposition, the fate of the proposed rule is likely to become a contentious issue that could lead to further legal and political debates.
