The bill provides financial protection for fresh produce sellers
The Canadian horticulture industry received an early Christmas gift with Bill C-280 passing its third Senate reading on Dec. 10 and becoming law.
The Financial Protection for Fresh Fruit and Vegetable Farmers Act, establishes a deemed trust financial protection mechanism for fresh produce sellers in Canada.
“The establishment of a deemed trust for all fresh produce sellers will strengthen food security in Canada and help ensure that our sector can continue to fulfill its important roles,” Massimo Bergamini, executive director of the Fruit and Vegetable Growers of Canada (FVGC), said in a statement.
This trust helps secure payment in the event of buyer bankruptcy.
In addition, Bill C-280 helps Canadian farmers receive preferential access to the U.S. under the country’s Perishable Agricultural Commodities Act (PACA).
PACA establishes a code of fair-trading practices covering the marketing of fresh and frozen fruits and vegetables in interstate and foreign commerce, the USDA says.
Canada lost its preferential status in 2014 because of a lack of protection in Canada for U.S. exporters.
Since that time, Canadians selling produce to the U.S. would’ve had to pay double the bond on shipments to access PACA dispute resolution mechanisms.
Filing a $25,000 claim, for example, would’ve cost $50,000.
That’s “a cost that is simply untenable for many Canadian businesses,” the FVGC said in a statement along with the Canadian Produce Marketing Association and the Fruit and Vegetable Dispute Resolution Corporation.
Conservative MP Scot Davidson (York-Simcoe) introduced the bill in the House of Commons in June 2022.
“Every time I see the dark soil and endless rows of vegetables in the Holland Marsh in my community, the soup and salad bowl of Canada, I see opportunity,” he said in the House.
“In order for that opportunity to be fully realized in the marsh and across Canada, more must be done to protect Canada's fresh fruit and vegetable growers during the bankruptcy of a buyer.
“We know that fresh fruits and vegetables are highly perishable with a limited shelf life. Unfortunately, the existing laws do not take this into account.”