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Have you paid your membership fees?

A friendly reminder that annual membership fees are due. Per the By-laws of the Corporation, failure to pay membership fee may result in termination of your membership, and leave you unprotected in future sales. If you have any questions regarding your outstanding annual membership fees, please contact us asap at DRC Help Desk | +1-613-234-0982 | info@fvdrc.com

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DRC Trading Standards – Section 20 – Trade Terms

As part of our continuing series to review Trading Standards, Section 20 contains those terms that are commonly used in North America.  A few articles in our Solutions Newsletter and Blog have been written focusing on situations where these trade terms are used. We will address most of these terms, which have to do with sometimes inconsistent INCOTERMS (see article North American Terms vs INCOTERMS).

For example, in North America, the most used terms are FOB and Delivered. However, in DRC’s trade terms which are very similar to PACA’s trade terms, the term FOB includes additional terms such as “FOB Acceptance”, “FOB Acceptance Final”, “FOB Inspection and Acceptance Arrival”, “FOB sale at a delivered price” and “FOB Steamer.” These terms are somewhat unusual and because they severely restrict rights and responsibilities they need to be discussed, understood and agreed upon to apply to a transaction. These terms are fully defined in this section of the Trading Standards and you should become familiar with them.

Another term included in this section is “Price After Sale (P.A.S.)” or “Open Price.” There is still some confusion between buyers and sellers using P.A.S. or Open Price which is not the same as consignment (P.A.S.  & Consignment Article). We have seen cases where these terms are interchanged and results in a different outcome from what was understood or expected.

Finally, “Purchase After Inspection,” “Shipping Point Inspection” and “Shipping Point Inspection Final” are also severely restrictive terms. These terms impact the rights of a buyer and the responsibilities of the seller and are very different from more commonly used terms. These terms require an inspection to be made either at shipping point or another location and limit the right of a buyer/receiver to make a claim after an inspection has been performed. In other words, the risk is passed to the buyer after an inspection is performed and limits the right to reject and or make claims at destination.

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Membership Updates – January 2020

Welcome New Members

In January, DRC welcomed the following new members:

  • Carthagro INC. (Québec, Canada)
  • Similien Produits Frais INC. (Québec, Canada)
  • Recyglobe Canada (Québec, Canada)
  • Panchvati Supermarket (Ontario, Canada)
  • Cogent Transport (Alberta, Canada)
  • 2727221 Ontario INC. (Ontario, Canada)
  • Hong King Food Market LTD. (Alberta, Canada)
  • Easybuy Trading LTD. (Ontario, Canada)
  • Fiston Ikwa Ndol Mbutiwi (Québec, Canada)
  • A-Mart Trading CORP. (Alberta, Canada)
  • Bacata Food Group INC. (British Columbia, Canada)
  • 2596604 Ontario INC. (Ontario, Canada)
  • Bles Farms (Alberta, Canada)
  • Arsaces General Trading INC. (Ontario, Canada)
  • Peri & Sons Farm, INC. (Nevada, USA)
  • Shipley Sales, LLC. (Arizona, USA)
  • Top Shelf Speciality (California, USA)
  • Les Produits et Saveurs Méditerranéennes (Québec, Canada)

DRC Membership: change in status

As of January 31, the following organizations no longer hold a DRC membership:

  • Abbotsford Growers LTD. (British Columbia, Canada)
  • All Season Farms LTD. (Ontario, Canada)
  • Blue Glacier Seafood Group INC. (British Columbia, Canada)
  • Centreport Canada INC. (Manitoba, Canada)
  • Chong Lee Market (British Columbia, Canada)
  • Colonial Garden Centre LTD. (Ontario, Canada)
  • Entreprise Promocurl INC. (Québec, Canada)
  • Exportadora Sergio Ruiz Tagle Humeres Limitada (Metropolitana, Chile)
  • Exportadora Y Servicios Rucaray S.A. (Providencia, Chile)
  • Green Island Produce, INC. (California, USA)
  • Groupe Frutex INC. (Québec, Canada)
  • Jardin Vert / Green Garden (Québec, Canada)
  • Matmata Prince Commerce INC. (Québec, Canada)
  • N&S Traders INC. (Ontario, Canada)
  • Nizam Produce INC. (Ontario, Canada)
  • Rokan Distribution LTD. (Ontario, Canada)
  • Sambafruits / Belavistabrasil (Sao Paulo, Brazil)
  • Savco U.S.A. CORP. (New Jersey, USA)
  • Seafood Express (P.E.I.) Limited (Prince Edward Island, Canada)
  • Sham Import Export (Québec, Canada)
  • Sociedad De Produccion Rural De Ri Villacarriedo Spr De Ri (Chiapas, Mexico)
  • Sybaris Market, S.L. (Valencia, Spain)
  • Tropical Superfruits Trading INC. (Ontario, Canada)

For details regarding a change in status, please contact the office.

Important note: Following membership termination, the former member remains liable for claims arising prior to their termination if the claim is submitted to DRC by way of a Notice of Dispute within nine (9) months from when the claim arose or within nine (9) months from when the claimant ought reasonably to have known of its existence.

About DRC

DRC is a non-profit membership-based organization whose core work is business-to-business commercial dispute resolution for produce. DRC is a referee between parties when a purchase and sale do not go according to plan. Members adhere to a common set of trading standards and member responsibilities that promote fair and ethical trading for produce entering the North American marketplace. In Canada, membership in the DRC is a regulatory requirement to trade fresh fruits and vegetables (i.e.: buy, sell, import, export) unless excepted from the regulations. Today, DRC has members in 14 countries outside of North America, and membership continues to grow annually. Anyone exporting fresh fruits and vegetables to Canada must sell to a DRC member.

In addition to the DRC’s Operating Rules and Trading Standards, DRC offers a comprehensive, tailored suite of tools to build the knowledge and capacity of members to avoid or resolve disputes, including education, mediation and arbitration. DRC has the ability to impose sanctions and disciplinary actions towards members who do not conduct business in accordance with the terms of their membership agreement.

To date, DRC has resolved claims in excess of $83 million dollars. Although arbitration is available, 80% of these claims have been settled in an average of 26 days through our informal consultation/mediation services. Arbitration awards are court enforceable in countries that are signatories to the New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards or subsequent conventions.

To learn more, reach out to our Help Desk at info@fvdrc.com or (+1) 613-234-0982 or visit us at www.fvdrc.com.

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Splitting Losses

Q. We are a wholesale receiver in Canada and recently bought a load of cucumbers originating from Mexico. We requested a CFIA inspection upon arrival as there are obvious problems in spite of good transit times and temperatures. The results of the inspection showed 25% total condition defects but no decay. We needed the product and there were no other cucumbers on the market. We shared the inspection results with the shipper who declined to make any adjustment or accept a consignment handling. While we know we could have rejected the product we elected to keep the product and claim damages so we could cover orders from as many customers as possible. After the product was sold, we provided an account of sales showing a net return of 66% of the total value of the shipper’s invoice. The shipper is not happy with the return. We would like to build a relationship with the shipper, but there is not much more we can absorb from the loss. What do you suggest we do?

A. Jaime Bustamante. First, we suggest you review your account of sales. Since you decided to keep the product and claim damages, your account of sales must show the date, amount, and price of the product sold. Your charges or expenses must be those resulting from receiving product that fails contract terms or DRC Good Arrival Guidelines. These includes freight, inspection cost, brokerage and any other direct out of pocket expense. Since the shipper offered you no help there are likely no other expenses you can claim. Without agreement you are essentially only entitled to break even. Frankly that is why most loads like this are rejected.

You have mentioned that you would like to keep working with them. There is no disagreement over the product received failing to meet DRC Good Arrival Guidelines or contract terms.   It is also true they were unwilling to discuss working the problem (which appears to be their fault) out with you.  If you are going to make a good faith offer, we highly recommend a frank discussion of how future claims will be handled .