The Beef Cattle Marketing Act provides the authority to require persons who sell cattle to pay a license fee. The two pertinent sections of the Act are as follows:

3.1  Except under the authority of a license, no person shall sell cattle.
3.2  Every person who sells cattle shall be deemed to be the holder of a license.

Regulations established pursuant to the Act:

1. designate the Ontario Cattlemen's Association to receive the license fees

2. fixes the amount of license fee at $2.25 per head

3. requires packing plant operators, auction market operators and livestock dealers who receive cattle from a seller to deduct the license fees and to remit the license fees by the 15th day of the following month

4. provides an exemption from the requirement to pay license fees where:
   A) the cattle, at the time of sale, are owned by a person who does not reside in Ontario
   B) the cattle are sold through a public auction sale that is organized for the purpose of selling only cattle for the production of milk
   C) the cattle are sold through a public auction sale in which all of the cattle that are sold or offered for sale are owned by the person on whose premises the public auction sale is held

The legislation and regulation contains no provisions for credits or refunds.

When the regulation was amended to require that livestock dealers deduct and remit OCA license fees, the OCA Board of Directors, following discussion with a number of livestock dealers, agreed to allow credits to dealers in a limited number of circumstances as follows:

A packer credit to a livestock dealer will only be allowed where the dealer's records verify that:

1. the cattle purchased and sold were the same cattle, and

2. the transaction was on a commission basis (no price mark-up), and

3. proof exists that OCA license fees were deducted on the purchase by the dealer.

The following principle applies to transactions between licensed dealers:

That livestock dealers trading cattle on a speculative basis will be subject to paying OCA checkoff but that an exemption from OCA checkoff will apply on sales from one livestock dealer to another livestock dealer where the purchase and sale is of the same cattle and the sale is made on a commission basis (no price mark-up).