Canada’s Fresh Produce Alliance calls for financial protection legislation

Members of the Fresh Produce Alliance — comprised of the Canadian Produce Marketing Association, the Fruit and Vegetable Dispute Resolution Corporation, and Fruit and Vegetable Growers of Canada have expressed support of the recent introduction of Bill C-280, the Financial Protection for Fresh Fruit and Vegetable Farmers Act, by conservative parliament member Scot Davidson (York–Simcoe).

If passed, Bill C-280 would establish a deemed trust mechanism for fresh produce growers and sellers in Canada, ensuring payment in the case of a buyer bankruptcy.

“In addition to providing healthy food to Canadians, the fresh produce supply chain supports 249,000 jobs in Canada,” CPMA President Ron Lemaire said. “A deemed trust mechanism is necessary to address gaps in market stability, trade and food security, with no cost to the government. We call on all political parties to support Bill C-280 to help ensure that Canadians continue to have access to fresh fruits and vegetables.”

The need for a financial protection mechanism has been a major focus of the sector’s federal advocacy efforts for several years and has been included among recommendations made by the House of Commons Standing Committees on Finance and Agriculture and Agri-food, the Fresh Produce Alliance noted in a news release.

"Having lived the challenge of a client's bankruptcy and ensuing losses, I believe that Bill C-280 establishes a critical tool to ensure that growers receive payment for their products, even in the event of a buyer bankruptcy," Quinton Woods, chair of Fruit and Vegetable Growers of Canada's trade and marketing work group, said. Woods is an Ontario-based grower, packer and shipper.

The introduction of a financial protection mechanism in Canada would also open the door to the reinstatement of preferential treatment under the U.S. Perishable Agricultural Commodities Act (PACA) for Canadians selling produce into the U.S. This preferential treatment had been in place prior to 2014, when it was rescinded by the U.S. due to a lack of reciprocal protection in Canada, according to the release.

“Without preferential access, Canadian sellers are now required to post a bond worth double the value of the shipment just to initiate a formal claim through PACA, putting Canadian businesses at a steep disadvantage,” Fruit and Vegetable Dispute Resolution Corporation President and CEO Luc Mougeot said. “Bill C-280 paves the way for a reciprocal arrangement that would support Canadian businesses selling to our largest trading partner.”