Louisiana Administrative Code
Title 7 - AGRICULTURE AND ANIMALS
Part XXI - Animals and Animal Health
Chapter 3 - Livestock Auction Markets; Market Agencies; Dealers
Section XXI-303 - Livestock Video Auction Market Requirements (Formerly Section 113)

Universal Citation: LA Admin Code XXI-303

Current through Register Vol. 50, No. 9, September 20, 2024

A. No person, partnership, corporation, or other legal entity, shall operate a market agency (livestock video auction) in Louisiana, without first obtaining a permit from the Livestock Sanitary Board. Any legal entity selling Louisiana livestock on a livestock video auction, without a valid livestock video auction permit, will be in violation of this regulation and subject to adjudication by the Livestock Sanitary Board.

B. Any applicant applying for a permit to conduct video sales of Louisiana livestock must submit an application to the Livestock Sanitary Board which must include the following information:

1. the name and complete address of the applicant;

2. a financial statement of assets and liabilities;

3. proof that the registration requirements of the Packers and Stockyards Administration, United States Department of Agriculture, have been met;

4. a statement, in writing, assuring the Livestock Sanitary Board that the livestock video auction will be operated in compliance with the Livestock Sanitary Board's laws, rules and regulations;

5. a statement, in writing, telling how the Louisiana livestock industry will benefit from the proposed sale of livestock by the applicant;

6. an application fee of $250, which will be retained by the Department of Agriculture and Forestry, whether or not the permit is granted;

7. the livestock video auction applicant must agree to establish a custodial account for seller's proceeds, which must meet the following requirements:
a. accounts. Each market agency shall establish and maintain a separate bank account designated as "Custodial Account for Shipper's Proceeds," or by some similar identifying designation, under terms and conditions with the bank where established, to disclose that the depositor is acting as a fiduciary with respect thereto and that the funds in the account are trust funds;

b. trust funds. Each payment made by a livestock buyer to a market agency, is a trust fund until the market agency's custodial account has been paid in full in connection with such purchase. Funds deposited in a custodial account are also trust funds, under both the gross proceeds and net proceeds methods of maintaining the custodial account. The market agency is a fiduciary with respect to the custodial account;

c. deposits:
i. gross proceeds method. Under the gross proceeds method, before the close of the next banking day, after livestock is sold, the market agency shall deposit in its custodial account, the proceeds from sale of livestock that are collected and received on the day of sale, and an amount equal to the proceeds receivable from the sale of livestock that are due from:
(a). the market agency;

(b). any owner, officer, or employee of the market agency; or

(c). any buyer to whom the market agency has extended credit;

NOTE: On or before the seventh day following the sale of livestock, the market agency shall deposit in the custodial account, an amount equal to all the proceeds receivable from the sale of livestock, whether or not such proceeds have been collected or received by the market agency.

ii. net proceeds method. In lieu of the gross proceeds method, any market agency may adopt, and thereafter continuously follow, a net proceeds method for making deposits in its custodial account. Under the net proceeds method, the market agency shall make the same deposits, at the same time as required under the gross proceeds method, but shall retain and not deposit the marketing charges, which are due the market agency;

d. withdrawals. The custodial account shall be drawn on only for payment of the net proceeds to the consignor or shipper, or such other person or persons who the market agency has knowledge is entitled thereto, to payall legal charges against the consignment of livestock which the market agency may, in its capacity as agent, be required to pay for, and on behalf of the consignor or shipper, and when the account is not kept on a net proceeds basis, to obtain therefrom, the sums due the market agency as compensation for its services;

e. accounts and records. Every market agency shall keep such accounts and records as will, at all times, disclose the handling of the funds in the custodial account referred to in this Section, including without limitations, such accounts and records as will, at all times, disclose the names' of the consignors and the amount due and payable to each, from funds in the custodial account for shipper's proceeds. These records shall be made available to the Livestock Sanitary Board under such rules and regulations as the board may provide;

f. insured banks. Custodial accounts required by this Section, shall be established and maintained in banks whose deposits are insured by the Federal Deposit Insurance Corporation;

g. certificates of deposit. Any market agency which has established and maintains the separate custodial account referred to in this Section, may invest in certificates of deposits issued by the bank in which such an account is kept, such portion of the custodial funds as will not impair the market agency's ability to meet its obligations to its consignors. Such certificates of deposit shall be made payable to the market agency in its fiduciary capacity as trustee of the custodial funds;

h. custodial accounts required by the Livestock Sanitary Board will be subject to periodic audits by representatives of the Livestock Sanitary Board.

C. The Livestock Sanitary Board, at a public hearing, is to consider the following factors when considering whether a permit should or should not be granted to an applicant wishing to receive a permit to sell Louisiana livestock on livestock video auctions:

1. the financial stability, business integrity and fiduciary responsibility of the applicant;

2. the present market services available in the state;

3. whether the proposed livestock video market would be permanent and continuous;

4. the benefits to be derived by the livestock Industry from the establishment and operation of the proposed livestock video auction;

5. the economic feasibility of the proposed livestock video auction.

D. Livestock video auction companies must maintain complete records of all transactions for a period of 12 months. The records must he kept in such a manner that all livestock can be traced from the seller to the purchaser and include the name and complete address of the seller and purchaser. The record must also include the weight, number, and price of the livestock. These records shall be made available at the request of representatives of the Livestock Sanitary Board, any time during normal working hours.

E. All sales of cattle by livestock video auctions must meet the requirements of §713

F. The livestock video auction company must notify the Louisiana Livestock Brand Commission of all delivery dates, as soon as the dates are established.

G. The Livestock Sanitary Board may cancel the permit of a livestock video auction after an adjudicatory hearing, for any one or more of the following reasons:

1. fraudulently misrepresenting the ownership, brands, or weights of livestock, the charges at a sale, the proceeds of a sale, or any other information with respect to a sale;

2. the applicant is unable to meet the registration requirements of the Packers and Stockyards Administration;

3. the applicant has violated the provisions with respect to the custodial account;

4. the applicant has violated any state or federal law or regulation governing livestock video auctions;

5. the applicant has not conducted any sales for a period of one year.

AUTHORITY NOTE: Promulgated in accordance with R.S. 3:2093, R.S. 3:2221, and R.S. 3:2228.

Disclaimer: These regulations may not be the most recent version. Louisiana may have more current or accurate information. We make no warranties or guarantees about the accuracy, completeness, or adequacy of the information contained on this site or the information linked to on the state site. Please check official sources.
This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.