Effort to introduce financial protection for Canada's horticultural growers begins anew

Tuesday, March 15, 2016

by SUSAN MANN

After years of inaction, the Canadian produce industry is finally seeing some activity on its efforts to get financial protection for growers from bankrupt or slow paying buyers.

Last week, NDP Essex MP Tracey Ramsey presented a motion in the House of Commons calling on the government to introduce payment protection for produce sellers by Sept. 30 that is similar to the Perishable Agricultural Commodities Act (PACA) in the United States. She also called on the government to reinstate Canadian growers’ privileged access under PACA by Dec. 31.

In place since 1930 and amended in 1984, PACA protects individual growers and companies selling fresh produce in the United States from financial losses caused by slow, partial or non-paying buyers who break contracts, are insolvent or go bankrupt. Until October 2014, Canadian farmers had preferred access to the PACA legislation when selling produce in the United States.

However, since Canada did not provide similar financial protection for American farmers selling produce in Canada, the United States cancelled Canadian farmers’ preferred access. As of Oct. 1, 2014, Canadian growers trying to recover payments for produce sold in the United States must post a bond worth double the value of the amount they are trying to recover to make a claim under the Act.

When they had preferred access, Canadian growers didn’t have to put up any money to make the claim.

Ontario farmer Ken Forth, chair of the Canadian Horticultural Council’s trade and marketing committee, says the NDP motion is “exactly what we had in mind.” However, he doesn’t know how long it will take Parliament to pass it.

Forth says after eight years of trying to convince the Canadian government to adopt legislation providing for financial protection for farmers, this is the closest the industry has come to getting that law.

Even though the motion was proposed by the NDP and the Liberals have a majority in the Canadian parliament, Forth says, “I don’t think that really matters because this (the need for the legislation) crosses party lines. This is not a political deal.”

In fact, the Liberals had promised during the 2015 federal election to restore Canada’s preferred access under PACA and bring in financial protection in Canada for produce sellers, he notes.

Forth explains the legislation providing for growers’ financial protection won’t cost the federal government any money. “All the government representatives will hold in their hands is the enabling legislation that we can use.”

If Canada passes the financial protection law, the Americans “will give us back the privileged position (under the U.S. law) that we had before,” he says. BF