Proposed amendments to R.R.O. 1990, Regulation 440 (Vegetables for Processing - Marketing) under the Farm Products Marketing Act.
Bill or Act:
Farm Products Marketing Act
Summary of Decision:
Amendments to Regulation 440 (Vegetables for Processing - Marketing) to update the negotiations framework for the Ontario Processing Vegetable Growers' (OPVG) authorities were filed with the Registrar of Regulations and took effect on December 21, 2017 .
The final amendments were informed by stakeholder feedback received through the registry posting, consultations sessions, meetings with the OPVG and the Ontario Fruit and Vegetable Growers Association.
The final amending regulation supports processor specific negotiations for all crops, while creating a pricing committee where there are five or more processors of a crop to establish the way minimum prices are negotiated. The amendments ensure a greater number of active growers on the negotiation agencies, mandatory meetings with growers prior to arbitration, and maintain final offer arbitration, unless parties agree that another dispute mechanism shall be used. The industry advisory committee composition allows for up to three grower elected representatives, four OPVG board representatives and four Commission appointed grower representatives.
Additional amendments, which will come into effect in December 2018, will regulate key terms and conditions of agreements between producers and processors, including adequate termination clauses.
October 12, 2017
Summary of Proposal:
In response to the Minister of Agriculture, Food and Rural Affairs' August 2016 directive, the Ontario Farm Products Marketing Commission (Commission) completed an economic analysis of the processing vegetable sector and held broad stakeholder consultations to help identify opportunities for growth, innovation and jobs in the industry. Based on that work, the Commission is proposing amendments to Regulation 440 to help achieve these objectives by creating opportunities for growers and processors to work together for the benefit of the entire value chain. Proposed amendments are briefly outlined below. A detailed summary is attached.
Industry Advisory Committee (IAC)
During consultations, there was broad support for the establishment of an IAC. The IAC would be comprised of growers, processors and industry stakeholders.
The Commission is proposing that negotiations consist of two rounds.
The first round would establish a base agreement, including minimum price and related terms and conditions on the average four year historical contracted tons for each processor.
The second round of negotiations would have negotiating agencies established for each processor, made up of active growers contracting with the specific processor, charged to negotiate processor specific terms and conditions related to the base agreement negotiated in round one.
In addition, the negotiating agency established as noted above would negotiate a minimum price for incremental tonnage above the historical four year average as well as related terms and conditions.
OPVG would continue to appoint members to each negotiating agency, which negotiate the agreements, but would be required to appoint a minimum number of active growers who contract with a processor for that crop.
Negotiation deadlines would be moved up by three weeks, with a required start date, so that constructive discussions could begin well in advance of deadlines.
Negotiations would be guided by a terms of reference, which would be established by the IAC, for consideration by the negotiating parties prior to the commencement of negotiations.
The amended regulation would allow either party to a negotiating agency to trigger mandatory conciliation prior to arbitration.
To promote increased consultation with growers during negotiations, growers would be given the power to call a meeting with their negotiating agency representatives prior to arbitration.
If arbitration is required, the arbitrator would have flexibility to make a decision that was not necessarily just one party's final offer in its entirety.
Oversight of OPVG's Regulations
OPVG would be required to provide the Commission with 30 days advance notice of any changes OPVG is proposing to make to its own regulations.
Parties would be required to provide the names of negotiating agency appointees to the Commission ahead of the start of negotiations.
The Commission would monitor the implementation of the proposed amended regulation, with a commitment to complete a full review by March 31, 2020.
Ontario Farm Products Marketing Commission
1 Stone Rd W, Guelph, N1G 4Y2
December 21, 2017