§ 87. — Conflicts of interest.
[Laws in effect as of January 24, 2002]
[Document not affected by Public Laws enacted between
January 24, 2002 and December 19, 2002]
[CITE: 7USC87]
TITLE 7--AGRICULTURE
CHAPTER 3--GRAIN STANDARDS
Sec. 87. Conflicts of interest
(a) Prohibition with respect to persons licensed or authorized by
Secretary to perform official functions
No person licensed or authorized by the Secretary to perform any
official function under this chapter, or employed by the Secretary in
otherwise carrying out any of the provisions of this chapter, shall,
during the term of such license, authorization, or employment, (a) be
financially interested (directly or otherwise) in any business entity
owning or operating any grain elevator or warehouse or engaged in the
merchandising of grain, or (b) be in the employment of, or accept
gratuities from, any such entity, or (c) be engaged in any other kind of
activity specified by regulation of the Secretary as involving a
conflict of interest: Provided, however, That the Secretary may license
qualified employees of any grain elevators or warehouses to perform
official sampling functions, under such conditions as the Secretary may
by regulation prescribe, and the Secretary may by regulation provide
such other exceptions to the restrictions of this section as the
Secretary determines are consistent with the purposes of this chapter.
(b) Prohibition with respect to personnel of official or State agencies
and business or governmental entities related to such agencies;
substantial stockholder; use of official inspection service;
authority delegation; report to Congressional committees
(1) No official agency or a State agency delegated authority under
this chapter, or any member, director, officer, or employee thereof, and
no business or governmental entity related to any such agency, shall be
employed in or otherwise engaged in, or directly or indirectly have any
stock or other financial interest in, any business involving the
commercial transportation, storage, merchandising, or other commercial
handling of grain, or the use of official inspection service (except
that in the case of a producer such use shall not be prohibited for
grain in which the producer does not have an interest); and no business
or governmental entity conducting any such business, or any member,
director, officer, or employee thereof, and no other business or
governmental entity related to any such entity, shall operate or be
employed by or directly or indirectly have any stock or other financial
interest in, any official agency or a State agency delegated inspection
authority. Further, no substantial stockholder in any incorporated
official agency shall be employed in or otherwise engaged in, or be a
substantial stockholder in any corporation conducting any such business,
or directly or indirectly have any other kind of financial interest in
any such business; and no substantial stockholder in any corporation
conducting such a business shall operate or be employed by or be a
substantial stockholder in, or directly or indirectly have any other
kind of financial interest in, any official agency.
(2) A substantial stockholder of a corporation shall be any person
holding 2 per centum or more, or one hundred shares or more, of the
voting stock of the corporation, whichever is the lesser interest. Any
entity shall be considered to be related to another entity if it owns or
controls, or is owned or controlled by, such other entity, or both
entities are owned or controlled by another entity.
(3) Each State agency delegated official weighing authority under
section 79a of this title and each State or local agency or other person
designated by the Secretary under such section to perform official
weighing or supervision of weighing shall be subject to the provisions
of subsection (b) of this section. The term ``use of official inspection
service'' shall be deemed to refer to the use of the services provided
under such a delegation or designation.
(4) If a State or local governmental agency is delegated authority
to perform official inspection or official weighing or supervision of
weighing, or a State or local governmental agency is designated as an
official agency, the Secretary shall specify the officials and other
personnel thereof to which the conflict of interest provisions of this
subsection (b) apply.
(5) Notwithstanding the foregoing provisions of this subsection, the
Secretary may delegate authority to a State agency or designate a
governmental agency, board of trade, chamber of commerce, or grain
exchange to perform official inspection or perform official weighing or
supervision of weighing except that for purposes of supervision of
weighing only, the Secretary may also designate any other person, if the
Secretary determines that any conflict of interest which may exist
between the agency or person or any member, director, officer, employee,
or stockholder thereof and any business involving the transportation,
storage, merchandising, or other handling of grain or use of official
inspection or weighing service is not such as to jeopardize the
integrity or the effective and objective operation of the functions
performed by such agency. Whenever the Secretary makes such a
determination and makes a delegation or designation to an agency that
has a conflict of interest otherwise prohibited by this subsection, the
Secretary shall, within thirty days after making such a determination,
submit a report to the Committee on Agriculture of the House of
Representatives and the Committee on Agriculture, Nutrition, and
Forestry of the Senate, detailing the factual bases for such
determination.
(c) Official agencies or State agencies not prevented from engaging in
business of weighing grain
The provisions of this section shall not prevent an official agency
or State agency delegated authority under this chapter from engaging in
the business of weighing grain.
(Aug. 11, 1916, ch. 313, pt. B, Sec. 11, 39 Stat. 485; Pub. L. 90-487,
Sec. 1, Aug. 15, 1968, 82 Stat. 766; Pub. L. 94-582, Sec. 13, Oct. 21,
1976, 90 Stat. 2880; Pub. L. 95-113, title XVI, Secs. 1604(h), 1606(g),
Sept. 29, 1977, 91 Stat. 1028, 1030; Pub. L. 103-156, Sec. 12(j), Nov.
24, 1993, 107 Stat. 1529; Pub. L. 103-354, title II, Sec. 293(a)(7),
Oct. 13, 1994, 108 Stat. 3237; Pub. L. 103-437, Sec. 4(a)(1), Nov. 2,
1994, 108 Stat. 4581.)
Amendments
1994--Subsecs. (a), (b). Pub. L. 103-354 substituted ``Secretary''
for ``Administrator'' wherever appearing.
Subsec. (b)(5). Pub. L. 103-437 substituted ``Committee on
Agriculture, Nutrition, and Forestry'' for ``Committee on Agriculture
and Forestry''.
1993--Pub. L. 103-156, Sec. 12(j), which directed amendment of
``Section 11'', without specifying the name of the Act being amended,
was executed to this section, which is section 11 of the United States
Grain Standards Act, to reflect the probable intent of Congress.
Subsec. (a). Pub. L. 103-156, Sec. 12(j)(1), substituted ``the
Administrator'' for ``he'' before ``determines''.
Subsec. (b)(1). Pub. L. 103-156, Sec. 12(j)(2)(A), substituted ``the
producer'' for ``he''.
Subsec. (b)(5). Pub. L. 103-156, Sec. 12(j)(2)(B), substituted ``the
Administrator'' for ``he'' in two places.
1977--Subsec. (b)(3). Pub. L. 95-113, Sec. 1604(h)(1), substituted
``to perform official weighing or supervision of weighing'' for ``to
perform supervision of weighing''.
Subsec. (b)(4). Pub. L. 95-113, Sec. 1606(g), substituted ``official
weighing or supervision of weighing'' for ``official weighing''.
Subsec. (b)(5). Pub. L. 95-113, Sec. 1604(h)(2), substituted ``to
perform official inspection or perform official weighing or supervision
of weighing except that'' for ``to perform official inspection or
perform supervision of weighing except that'' and ``member, director,
officer'' for ``member, officer''.
Subsec. (c). Pub. L. 95-113, Sec. 1604(h)(3), inserted ``or State
agency delegated authority under this chapter'' after ``official
agency''.
1976--Subsec. (a). Pub. L. 94-582, Sec. 13(a)-(c), substituted
``Administrator'' for ``Secretary'' wherever appearing and ``perform any
official function'' for ``perform any official inspection function'',
and designated first paragraph provisions, as amended, as subsec. (a),
respectively.
Subsecs. (b), (c). Pub. L. 94-582, Sec. 13(c), added subsecs. (b)
and (c).
1968--Pub. L. 90-487 substituted provisions prohibiting a conflict
of interest on the part of inspectors who are interested financially in
a grain elevator or in grain merchandising, for provisions covering the
separability of provisions of this chapter.
Effective Date of 1977 Amendment
Amendment by Pub. L. 95-113 effective Oct. 1, 1977, see section 1901
of Pub. L. 95-113, set out as a note under section 1307 of this title.
Effective Date of 1976 Amendment
Amendment by Pub. L. 94-582 effective 30 days after Oct. 21, 1976,
see section 27 of Pub. L. 94-582, as amended, set out as a note under
section 74 of this title.
Effective Date of 1968 Amendment
For effective date of amendment by Pub. L. 90-487, see section 2 of
Pub. L. 90-487, set out as a note under section 78 of this title.
Section Referred to in Other Sections
This section is referred to in sections 79, 87b of this title.
