Author: DRC

DRC Trading Assistance Manager, Jaime Bustamante, was one of the guest speakers for a web-based training seminar series titled: Strengthening your capabilities to successfully export to Canada. The well-attended webinars were organized by PROMEXICO, the Department of Global Affairs Canada and the Trade Facilitation Office of Canada.

The web-based training seminars were held on February 21^st and 24^th and March 8^th, 2017 with an audience that included government representatives, growers, shippers and students. The seminar was designed for attendees to garner detailed information on access requirements and competitive advantages that help make a product successful in the Canadian market.

Topics covered included an overview of the Canadian market for fresh fruit and vegetables, distribution channels, practical advice and tips, financing tools, food safety and certification requirements. Another interesting topic broached was: Understanding social responsibility and the role of women.  Jaime was on hand to represent DRC and provide an overview of the corporation’s role in the industry and services it offers.

If you are interested in DRC representation at an event or speaking engagement, or would like to discuss a possible webinar, please reach out to the DRC Help Desk at:

DRC Help Desk | 613-234-0982 | [email protected]

DRC Trading Assistance Manager, Jaime Bustamante, was on hand to represent DRC at the Fresh Produce Association of the Americas’ (FPAA) two-day Spring Policy Summit. Held at the Tubac Golf Resort and Spa in Tubac, Arizona February 28-March 1^st, the event drew attendees from the U.S., Mexico and Canada. Attendees from the fresh produce industry were on hand to discuss issues impacting the import operations of fruit and vegetable distributors. Topics discussed included food safety regulations, harmonization of food safety laws and regulations, efficiencies at borders and incorporation of new cold storage inspection areas at port of entry. Guest speakers included representatives from the U.S. Food and Drug Administration and their counterparts from Mexico and Canada, U.S. Customs and Border Protection, Mexican Customs and more. Takeaways from the event were focused on efficiency, relationship building and collaboration.

The Canadian Food Inspection Agency’s (CFIA) public consultation for proposed Safe Food for Canadians Regulations is coming to a close. The opportunity to share your comments on the draft regulations posted in the Canada Gazette, Part I, closes on April 21^st, 2017. CFIA has hosted in-person and web-based information sessions across the country in February and March 2017. The sessions provided an overview on background information and key facts about the proposed regulations; a review of what the regulations would mean to consumers, food importers, and businesses that prepare food for export or trade across provinces; question and answers sessions; and finally, instructions on how to participate and provide your comments during the consultation.

The draft regulations, draft guidance documents and instructions for submitting comments can be viewed at the following link: http://inspection.gc.ca/about-the-cfia/acts-and-regulations/regulatory-initiatives/sfca/consultation/have-your-say/eng/1482239403639/1482239479767.

Please ensure your comments are submitted by April 21^st, 2017.

Under the current regulatory landscape in Canada, companies that are importing fresh produce from another country or buying from another province (with a few exemptions) must be a DRC member in good standing or have a CFIA license. While impending changes to the Safe Food for Canadians Regulations have been outlined in a previous Solutions Article, one thing remains the same – consequences of loss of good standing:

Once a DRC membership is terminated, there is no protection on future sales or potential claims.

Termination of DRC membership often has other business consequences as well. Many buyers, chains, wholesalers, distributors and large shippers will only do business with DRC members. Don’t let your membership lapse and risk severing business relationships if your firm is no longer an active DRC member.  You must be a member in advance of a dispute in order to take advantage of the assistance we offer including the DRC dispute resolution model. The model is designed to reduce risk and facilitate fair and ethical trade between members.

We encourage our members to ask their buying partners to become DRC members if they are not already. Given the complexity and perishability of produce, we help DRC members resolve disputes in a fast and fair manner. While some firms will be required to be members under the impending new legislation, anyone buying or selling produce can be a member with the same rights and responsibilities.

DRC Membership is an excellent risk management tool that allows members to focus on their business while we help them resolve their disputes. For less than the cost of most loads, you have year round peace of mind. Anyone who grows, buys, sells, brokers or provides transportation services for produce should be a DRC member in order to protect their business. DRC members are obligated to follow DRC Rules and participate in the dispute resolution process. Any member who fails to comply will be disciplined which can include termination, and in some cases loss of the ability to import products.

To find out more about becoming a DRC member or ensuring your membership is up to date and in good standing, please visit FVDRC.com or contact the DRC.

Remember, you must be a member in advance of a dispute in order to take advantage of the assistance we offer.

For more information please call or email the DRC Help Desk at:

DRC Help Desk | 613-234-0982 | [email protected]

A friendly reminder that a few of you have DRC membership fees that are past due. Failure to pay your annual membership dues may result in termination of your membership in accordance with the By-laws of the Corporation.

In order to stay in good standing, if you have yet to pay your yearly membership fees, please contact us asap at: DRC Help Desk | 613-234-0982 | [email protected]

This March, the Ontario Produce Marketing Association (OPMA) will be offering a three-day seminar to help participants become familiar with the most efficient way to receive and check a load of produce on arrival to determine quality. OPMA’s Director of Inspection Services, Jeff Honey, will be covering topics including determining if an inspection is warranted, reviewing requirements of inspection programs, how to interpret Canadian and U.S. grade standards, and more. An up-to-date receiver who has been properly trained will save time and money for their organization. Coming out of this seminar, participants will know when and how to request inspections that will be of maximum use when negotiating a claim with a shipper.

OPMA have provided custom seminars on single commodities as well as custom sessions specific to what the attendees grow and pack or what they may store for others. OPMA is happy to work with companies to provide a session suitable to your specific needs. Over twenty fruits and vegetables are covered over the three-day course and either Canadian or US grade standards and inspection instructions are distributed and discussed. Participants are asked to bring in samples for discussion and grading. Jeff also has hundreds of photos of defective produce that he has taken over the years, or that have been sent to him for defect identification.

Receivers must act quickly when loads arrive with suspected quality issues. In the event of a dispute, inspections of damaged or deteriorated produce are a vital part of settling produce claims.

Jeff Honey grew up in Quebec and is fluently bilingual, provided seminars in English or French. Previous to joining OPMA in 1995, Jeff was with the Canadian Food Inspection Agency (CFIA). The senior inspector at the Ontario Food Terminal for over five years, Jeff supervised an inspection staff of up to sixteen people. Since 1996, OPMA have trained more than 900 people from across Canada including growers, packers, shippers, wholesalers, retailers, logistics specialists, buyers and sales staff.

OPMA Seminar Session 1

March 22, 2017 8:00 am – 4:00 pm

OPMA Seminar Session 2

March 23, 2017 8:00 am – 4:00 pm

OPMA Seminar Session 3

March 24, 2017 8:00 am – 4:00 pm

Seminars will be held at the OPMA offices: 165 The Queensway, Suite 225, Toronto, Ontario, M8Y1H8, Canada

For more information please contact Jeff Honey at 416-519-9390 ext. 232. To register, please fill out the form at:

http://www.theopma.ca/wp-content/uploads/OPMAtemplatetrainingregist.form_.pdf

Q. We recently delivered overseas product to our Toronto customer. Upon arrival, the receiver relayed concerns about condition including bruising and discoloration. Five days after the load’s arrival, our customer advised us that the product had been sold but they were seeking a significant adjustment. To date we have not received any documentation regarding the claim. If we make an offer to settle are we accepting that they do not need to prove damages and provide the proper documentation? What options are available to us?

A. (Answer provided by Jaime Bustamante, Trading Assistance Manager)
Consistent with industry and DRC Rules a valid claim has three parts:

1. The receiver must provide prompt notice of a problem. In this case, your customer appears to have complied.
2. The supplier must acknowledge a breach of contract or the customer must provide a federal inspection demonstrating a breach.
3. Should the inspection show product failed to meet contract terms or DRC Good Arrival Guidelines, the customer still needs to provide the method used to arrive at the offer. In our industry, the most common method is an account of sales quantifying monetary damages. In this example, neither appears to have been made available.

Therefore, to answer your question, you can accept or propose a settlement offer without documentation however you lose your ability to request proof in future.  Essentially, you are taking the customers word as fact, acknowledging and accepting the stated condition of the product and the return. If you would like a higher return, you can provide an offer/counter-offer clearly listing the amount you’d settle for and a response deadline with the clause that, should the offer not be accepted, you will be seeking payment in full. If the offer/counter-offer is rejected, the customer will be bound to pay the original invoice price less provable damages (most popular method is with a federal inspection and a prompt and proper account of sales). Lacking this documentation, an arbitrator (should it go to arbitration) would likely award payment in full.

Q. We are a Mexican grower/shipper but are not a member of DRC. We are negotiating a Marketing Agreement with a US distributor who is a DRC member. The Marketing Agreement includes an arbitration clause indicating that if there is a dispute we agree to use the services of DRC. If both parties sign this contract and encounter problems related to the contract, would we be able to immediately take action through DRC.

A. (Answer provided by Jaime Bustamante, Trading Assistance Manager): Prior to signing a contract, you have to make sure that the arbitration clause included in the Marketing Agreement follows the wording of our suggested DRC Arbitration Clause. While arbitration clauses can be modified or have additions, there are some parts that cannot be changed. You can give us a call and we can advise you on correct wording to the arbitration clause to help ensure that the clause is binding. Secondly, if, after signing the contract, you have a dispute, you would need to join DRC or pay the non-member fee to access our dispute resolution system. We will provide both parties with the options and procedures to resolve the issue through our dispute resolution system.

However, be aware that if one of the parties decides to take the dispute to a court of law, the judge will be the one deciding the avenue for recourse: DRC or court. In our experience, if the contract has a valid arbitration clause, the courts will enforce it and oblige the parties to go to arbitration.

To avoid involvement of the court for enforcement of the clause, DRC always recommends that before you begin a commercial relationship, you join or invite your customer to join DRC. If you become a DRC member and deal with other members both parties will be protected in case of a contract dispute.

Paola Gonzalez Diaz, Trading Assistance Officer will be taking on some additional communications and membership duties as Andrea Bernier, Manager, Communications & Membership departs on leave. Ms. Bernier leaves some big shoes to be filled and will be missed, while away, by staff and members alike. For additional information please contact:

DRC Help Desk | 613-234-0982 | [email protected]

While DRC has helped resolve disputes worth millions of dollars, we strive to counsel and educate our members about best practices in business so they may avoid disputes altogether. Our dispute resolution model is designed to reduce risk and facilitate trade between members. DRC provides dispute prevention education via confidential consultation, the DRC Help Desk, seminars, guest speaking opportunities, fact sheets, our Solutions blog, and more.

Did you know? The two most important things parties can do to help avoid disputes are: COMMUNICATE and DOCUMENT.

Clearly communicate your understanding and document the details of the transaction. To help you get started, DRC has included an example of a Contract of Sale.