The following are some basic responsibilities for market agencies selling on commission, and stockyards owners. Please refer to the Packers and Stockyards Act, 1921, as Amended and Supplemented, and the Regulations issued there under, for a complete list of legal responsibilities.

Registration. Every person operating or desiring to operate as a market agency to sell livestock for others shall apply for registration under the Act. To file for registration you would need to complete form P&SP-1000 ? Application for Registration.

Bonds. Every market agency shall execute and maintain a reasonable bond, as a measure of protection for livestock consignors. The size of the bond is based on the volume of business, generally the average of their sales with a minimum bond of $10,000. Market Agencies, Selling on Commission will need to file a clause 1 bond or bond equivalent.

Custodial (Trust) Accounts. Every market agency engaged in selling livestock on a commission or agency basis shall establish and maintain a separate bank account designated as "Custodial Account for Shippers' Proceeds". This is a special trust account designed to ensure payment to consignors. P&S regularly audits this account, and there are special regulations governing how it is handled. The account is a fiduciary account. The market must deposit all proceeds from the sale of livestock into this account, and use this account to pay all consignors of livestock. It is for the transfer of money between the buyer and seller of livestock only. Proceeds from non-livestock items, such as tack, rabbits, chickens, etc., cannot go through this account. Market Guide to Custodial Accounts.

Tariff. Each stockyard owner and market agency operating at a posted stockyard shall post for public inspection and file a signed copy with P&SP of all schedules of rate and charges that they will charge for stockyards services. Any changes to the approved tariffs must be posted at the market for at least 10 days before making the new charges effective.

Prompt Payment. Each market agency shall, before the close of the next business day following the sale of any livestock consigned to it for sale, transmit or deliver to the consignor the net proceeds received from the sale and a true written account of such sale. The account of sale should show the number, weight, and price of each kind of animal sold, the date of sale, the commission, yardage, and other lawful charges, and such other facts as may be necessary to complete the account and show fully the true nature of the transaction. The parties to a transaction may agree in writing prior to the transaction to effect payment in a manner other than previously described.

Scales. All livestock scales subject to P&SP must be tested for accuracy by a competent agency at least each six months. The certification form must be filed with the regional P&SP office. Any scale known to be inaccurate may not be used.

Weighing. Only competent, trained weighmasters should weigh livestock. All weighmasters must read and sign an Acknowledgment Form certifying that they have read the Instructions for Weighing Livestock or Poultry. The weighmaster should ensure that the scale will provide accurate weights prior to weighing. The weighmaster should keep the scale balanced at zero at all times; check the zero balance every 15 minutes or 15 drafts, and after every draft of more than half the scale capacity; record the time of zero balance check; and weigh each draft of livestock to the nearest scale division. The weighmaster should favor neither the buyer nor the seller; print a scale ticket only while livestock is on scale and scale has settled; complete the scale ticket; allow persons having a legitimate interest in a draft of livestock to observe the weighing; and reweigh a draft of livestock immediately if requested.

Unfair Practices. It shall be unlawful for any stockyard owner or market agency to engage in or use any unfair, unjustly discriminatory, or deceptive practice or device.

Records. Every stockyard owner and market agency shall keep such accounts, records, and memoranda as fully and correctly disclose all transactions involved in his/her business, including the true ownership of such business. The records must by maintained for two full years, or longer if instructed by the Administrator.

Annual Reports. Every stockyard owner and market agency shall file an annual report with P&SP. A Market Agency Selling on Commission will need to file form P&SP-3200 on a yearly basis.

Inspection of Business Records and Facilities. Each stockyard owner and market agency, upon proper request, shall permit authorized representatives of the Secretary of Agriculture to enter its place of business during normal business hours and to examine records pertaining to its business subject to the Act.

Posting. After the Secretary has given public notice, any livestock facility deemed to fall into the definition of a stockyard under the P&S Act shall post copies of the public notice in the stockyard. The stockyard must report changes to the stockyard ownership and operations to GIPSA as often as necessary. Once posted, a stockyard remains subject to the provisions of the P&S Act until the Secretary gives notice that the stockyard no longer meets the definition of a stockyard. At which time, the Secretary will issue another public notice indicating that the stockyard has been de-posted.

Last updated 08/17/07