Tuesday, August 11, 2009

DOJ-USDA Announce Joint Workshops on Antitrust Issues in Agriculture . . .

This posting was written by Darius Sturmer, Editor of CCH Trade Regulation Reporter.

The Department of Justice announced on August 5 that it would, for the first time, hold a series of joint public workshops with the U.S. Department of Agriculture (USDA) to explore competition issues affecting the agriculture industry in the 21st century and the appropriate role for antitrust and regulatory enforcement in that industry.

The joint workshops will address the dynamics of competition in agriculture markets, including, among other issues, buyer power (also known as monopsony) and vertical integration. They also will examine legal doctrines and jurisprudence and current economic learning.

The workshops, which will begin in early 2010 and take place in Washington, D.C. and elsewhere, will provide an opportunity for farmers, ranchers, consumer groups, processors, agribusinesses, and other interested parties to provide examples of potentially anticompetitive conduct and to discuss any concerns about the application of the antitrust laws to the agricultural industry.

The Justice Department and USDA seek comments from interested parties on the application of antitrust laws to monopsony and vertical integration in the agricultural sector, including the scope, functionality, and limits of current or potential rules.

They also invite input on additional topics that might be discussed at the workshops, including:

• The impact of agriculture concentration on food costs,

• The effect of agricultural regulatory statutes or other applicable laws and programs on competition,

• Issues relating to patent and intellectual property affecting agricultural marketing or production, and

• market practices such as price spreads, forward contracts, packer ownership of livestock before slaughter, market transparency, and increasing retailer concentration.

Comments may be submitted to the Department of Justice through December 31, 2009. Comments in paper form should be submitted to: Legal Policy Section, Antitrust Division, Department of Justice, 450 5th Street, N.W., Suite 11700, Washington, D.C. 20001, while the electronic versions of comments should be submitted to: agriculturalworkshops@usdoj.gov.

A press release on the public workshops appears here on the Department of Justice Antitrust Division website.

. . . While Antitrust Division Official Previews Issues to Be Examined

At a conference in St. Louis on August 7, Deputy Assistant Attorney General Philip J. Weiser discussed the current state of affairs in agriculture markets and previewed some of the areas expected to be addressed in the upcoming series of joint DOJ/USDA public workshops on competition issues in the agricultural industry.

Weiser—who is in charge of Policy, Appellate, and International Matters at the Antitrust Division—discussed the role that concerns about agricultural competition played in spurring the enactment of the Sherman Act, particularly trusts controlling the price of livestock in Chicago and cottonseed oil in the South.

Reflecting on the changing nature of the agriculture marketplace, given the technology advances of the last 20 years, Weiser noted the emergence of large firms using patented biotechnology to produce larger crop yields and the Antitrust Division’s activity in evaluating mergers within the industry.

According to Weiser, topics of the upcoming public workshops will include:

• The state and nature of competition in a range of agricultural market segments.

• The impact of vertical integration.

• Concerns about “buyer power” (monopsony).

• Other regulatory regimes, such as the Packers and Stockyards Act.

• Questions about the nature of transparency in the marketplace.

The remarks—“Toward a Competition Policy Agenda for Agriculture Markets"—was delivered at the 11th annual conference of the Organization for Competitive Markets. Text of the speech appears here at the website of the Department of Justice Antitrust Division.

No comments: