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This answer comes from Jim King (WPFG Federation).
Yes, Powerlifting was the weight sport up to 1999, Stockholm, Sweden. In 2001, Indianapolis, the format was changed to a “Push/Pull” meet. This was brought about by officiating and equipment changes.
On the officiating side, the depth of the squat was always contentious (still is). Instead of making individuals squat down to their ankles, the depth was always a judgment call. Most of the time, it was a correct call. Sometimes, it was not.
Equipment had become an issue as well. Super suits and knee wraps were excessive. An attempt to standardize the types of gear people were lifting in became problematic. There was always someone who tried to bend the rules. Wearing a super suit backwards for the deadlift was popular as well. Bench Press shirts, double, triple ply, metals locking, it went on and on.
So, the WPFGF Director at the time (Bob Burke) decided to go to a “Raw”, “Push Pull” format. I was the Director of Sport for Indy in 2001 and agreed with Bob’s decision; in fact I encouraged it. The numbers have never suffered. I am sure there are some powerlifting purists who have decided to not compete, but the numbers of competitors indicates that it is a small amount.