Senate to Debate Agribusiness Merger Moratorium

November 8, 1999

The Senate is scheduled to debate and vote early this week on a moratorium on certain types of agribusiness mergers. The legislation is opposed by nine organizations representing food processors. It could come up for debate as early as today with a vote on Tuesday.

Sen. Paul Wellstone (D-MN) says the amendment would impose a moratorium on mergers and acquisitions among agribusinesses with annual net revenue or assets of more than $100 million for one party and $10 million for the other. The moratorium would remain in effect for 18 months or until Congress enacts legislation to address the problem of concentration in agriculture, whichever comes first.

The legislation also establishes a federal review commission to study and made additional legislative recommendations regarding concentration in agriculture. Also sponsoring the bill are Sens. Byron Dorgan (D-ND), tom Harkin (D-IA), Tom Daschle (D-SD), Tim Johnson (D-SD) and Patrick Leahy (D-VT). The measure is to be considered as an amendment to the bankruptcy bill the Senate began considering Friday.

However, a letter dated Nov,. 4 went to senators in opposition to the moratorium legislation. REUTERS reports the letter said the proposal would force "a faltering agribusiness (to) simply close its doors, leaving employees, farmers and communities to look for other sources of income. Like farmers who seek to sell their land when they retire, mergers and acquisitions often serve as the retirement plan for small business owners."

Singing the letter were the American Bakers Association, American Meat Institute, Grocery Manufacturers of America, International Dairy Foods Association, National Association of Manufacturers, National Food Processors Association, National Meat Association, North American Meat Processors and Produce Marketing Association.