Thursday, July 11, 2013

U.S. Senate Agriculture Committee Holds Hearing Concerning the Potential Purchase of Smithfield

On July 10, 2013, experts on U.S.-China trade relations, food safety, global business, and foreign acquisitions, as well as the CEO of Smithfield Foods, testified in a hearing held by the Senate Agriculture Committee about the $7.1 billion potential purchase of Smithfield Foods by Shuanghui, a Chinese meat processing company. The hearing examined how the government review process of foreign acquisitions of U.S. companies addresses American food safety, protection of American technologies and intellectual property, and the effects of increased foreign ownership of the U.S. food supply.

CEO of Smithfield, Larry Pope, and the Honorable Matthew Slaughter, professor and Faculty Director of the Center for Global Business and Government at Dartmouth’s Tuck School of Business, supported the acquisition, noting that the U.S. has much to gain through the increased exports of American pork. Dr. Usha Haley, professor and director of the Robbins Center for Global Business and Strategy, West Virginia University, and Mr. Daniel Slane, Commissioner of the US-China Economic and Security Review Commission, U.S. Chamber of Commerce, voiced concerns about how the precedent of a purchase of this magnitude and kind would affect future acquisitions by China of U.S. companies, particularly in the agricultural sector.

After testimony, the Senate Ag Committee Chair, Debbie Stabenow, along with other committee members, questioned the experts as to the potential benefits and concerns over the purchase of a U.S. food company by a Chinese firm.

At least one commentator has opined that the hearing was an effort to put pressure the Committee on Foreign Investment in the U.S.

For Senator Stabenow’s opening statement and the prepared testimony of the witnesses, please visit the U.S. Senate Committee on Agriculture, Nutrition and Forestry’s website.

Written by Sarah Doyle - Research Assistant
The Agricultural Law Resource and Reference Center
July 11, 2013

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