AMS No. 172-10
Michael Jarvis
(202) 720-8998
Michael.jarvis@ams.usda.gov
WASHINGTON, Aug. 23, 2010 – The U.S. Department of Agriculture is reopening the comment period for the proposed rule regarding trust protection and post-default payment agreements under the Perishable Agricultural Commodities Act (PACA).
A new 30-day comment period begins Aug. 23, 2010, with all comments now due by Sept. 22. The original 60-day comment period ended Aug. 9. Comments can be e-mailed to: http://www.regulations.gov.
USDA’s Agricultural Marketing Service had issued the proposal in response to concerns raised by the produce industry. PACA imposes a statutory trust on certain assets of persons or entities subject to the act that have not paid for perishable agricultural commodities. Trust-eligible produce transactions must meet certain criteria under PACA. As a result of the PACA trust provisions, unpaid sellers have recovered hundreds of millions of dollars that most likely would not otherwise have been collected.
While the regulations clearly define the maximum allowable payment terms of 30 days for pre-transaction agreements, payment terms in post-default agreements are not mentioned. The proposed rule revises the PACA regulations to provide greater direction to the industry on how trust rights may be preserved in post-default situations.
Specifically, if there is a default in payment as defined in the regulations, the amendment would allow a seller, supplier or agent who has met the eligibility requirements to enter into a written scheduled payment agreement of the past due amount while maintaining its trust eligibility.
The PACA proposed rule regarding the trust protection and post-default payment agreements can be found in the Federal Register, Volume 75, Number 109; listed under docket # AMS-FV-09-0047, 7 CFR Part 46.
Follow us on Twitter to receive the latest press release, stories, and important updates about the Agriculture Marketing Service at: http://twitter.com/USDA_AMS_NEWS.
USDA is an equal opportunity provider, employer and lender. To file a complaint of discrimination, write: USDA, Director, Office of Civil Rights, 1400 Independence Ave., S.W., Washington, DC 20250-9410 or call (800) 795-3272 (Voice) or (202) 720-6382 (TDD).