Capper–Volstead Act


Capper–Volstead Act, the Co-operative Marketing Associations Act was adopted by the United States Congress on February 18, 1922. It gave “associations” of persons producing agricultural products certain exemptions from antitrust laws. It is sometimes called the Magna Carta of cooperatives.

Origins

The law was passed in response to challenges made against cooperatives using the Sherman Act, the Clayton Antitrust Act , and the Federal Trade Commission Act. As a consequence of the depression of agricultural prices subsequent to World War I, farm organizations intensified their drive for government aid and managed to get a farm bloc established in Congress. Senator Arthur Capper was a member of this bloc and the Capper–Volstead Act was a part of the farm legislative program.

Content

The act authorized various kinds of agricultural producers to form voluntary co-operative associations for purposes of producing, handling and marketing farm products - that is, it exempted such associations from the application of the antitrust laws. The United States Secretary of Agriculture was given power, on his own motion, to prevent such associations from achieving and maintaining monopolies. He could hold hearings, determine facts and issue orders ultimately subject to review by federal district courts.