SA 3691. Mr. ENZI (for himself, Mr. Dorgan, Mr. Grassley, Mr. Conrad, Mr. Johnson, Mr. Tester, and Mr. Barrasso) submitted an amendment intended to be proposed to amendment SA 3500 proposed by Mr. Harkin (for himself, Mr. Chambliss, Mr. Baucus, and Mr. Grassley) to the bill H.R. 2419, to provide for the continuation of agricultural programs through fiscal year 2012, and for other purposes; which was ordered
to lie on the table; as follows:

On page 1234, between lines 11 and 12, insert the following:
SEC. 102__. LIMITATION ON USE OF FORWARD CONTRACTS.
(a) In General.--Section 202 of the Packers and Stockyards Act, 1921 (7 U.S.C. 192) (as amended by section 10207(a)), is amended--
(1) by redesignating subsections (g) and (h) as subsections (h) and (i), respectively; and
(2) by inserting after subsection (f) the following:
``(g)(1) Use, in effectuating any sale of livestock, a forward contract that--
``(A) does not contain a firm base price that may be equated to a fixed dollar amount on the day on which the forward contract is entered into;
``(B) is not offered for bid in an open, public manner under which--
``(i) buyers and sellers have the opportunity to participate in the bid; more than 1 blind bid is solicited; and buyers and sellers may witness bids that are made and accepted;
``(ii) is based on a formula price; or
``(iii) provides for the sale of livestock in a quantity in excess of--
``(I)(aa) in the case of cattle, 40 cattle;
``(bb) in the case of swine, 30 swine; and
``(cc) in the case of other types of livestock, a comparable quantity of the type of livestock determined by the Secretary; or
``(II) such other quantity, as determined appropriate by the Secretary, except that
``(2) paragraph (1) shall not apply to--
``(A) a cooperative or entity owned by a cooperative, if a majority of the ownership interest in the cooperative is held by active cooperative members that--
``(i) own, feed, or control livestock; and
``(ii) provide the livestock to the cooperative for slaughter;
``(B) a packer that is not required to report to the Secretary on each reporting day (as defined in section 212 of the Agricultural Marketing Act of 1946 (7 U.S.C. 1635a)) information on the price and quantity of livestock purchased by the packer; or
``(C) a packer that owns 1 livestock processing plant;''.
(b) Definitions.--Section 2(a) of the Packers and Stockyards Act, 1921 (7 U.S.C. 182(a)) (as amended by section 10203) is amended--
(1) by redesignating paragraphs (5) through (18) as paragraphs (7) through (20), respectively; and
(2) by inserting after paragraph (4) the following:
``(5) FORMULA PRICE.--
``(A) IN GENERAL.--The term `formula price' means any price term that establishes a base from which a purchase price is calculated on the basis of a price that will not be determined or reported until a date after the day the forward price is established.
``(B) EXCLUSION.--The term `formula price' does not include--
``(i) any price term that establishes a base from which a purchase price is calculated on the basis of a futures market price; or
``(ii) any adjustment to the base for quality, grade, or other factors relating to the value of livestock or livestock products that are readily verifiable market factors and are outside the control of the packer.
``(6) FORWARD CONTRACT.--The term `forward contract' means an oral or written contract for the purchase of livestock that provides for the delivery of the livestock to a packer at a date that is more than 7 days after the date on which the contract is entered into, without regard to whether the contract is for--
``(A) a specified lot of livestock; or
``(B) a specified number of livestock over a certain period of time.''.


(As printed in the Congressional Record for the Senate on Nov 15, 2007.)