It was April Fool’s Day for some, but April 1 was also the launch of the revised Horticulture Code, which sets out mandatory requirements for horticulture producers, agents and merchants operating in Australian fresh fruit and vegetable markets.
The revised code aims to improve the clarity and transparency of trading arrangements between growers and traders in the horticulture sector.
Traders and agents now need clear documentation of general trading terms and to have written agreements in place with farmer clients, Australian Competition and Consumer Commission (ACCC) Commissioner Mick Keogh said.
“Farmers producing fruit and vegetables will be given increased protection under the Horticulture Code as it improves competition and commercial practices in fresh fruit and vegetable markets in Australia,” Mr Keogh said.
“From 1 April 2018, the Code will apply to all transactions between farmers and agents or merchants, regardless of when any trading agreement was put in place. This is a real win for farmers,” he said.
The changes provide the ACCC with new powers to issue infringement notices of $9,000 for businesses, and $1,800 for individuals and seek penalties of up to $54,000 in court for code breaches.
“Infringement notices will allow the ACCC to quickly deal with conduct it believes breaches the code, while tougher court penalties should provide a stronger deterrent than was the case under the current code,” Mr Keogh said.
A new addition requires negotiating parties to act in good faith, or face potential fines.
“Farmers deserve fairness and honesty from their trading partners and the good faith requirement will help ensure they aren’t subjected to illegitimate business conduct,” Mr Keogh said.
“The good faith requirement will also bring the Horticulture Code into line with the Food and Grocery and Franchising codes, which have similar provisions.”
Horticulture producers, agents and merchants have until have until 1 April 2018 to make existing horticulture produce agreements compliant with the code, however any new or renewed agreements must comply with the revised code immediately.
There is no transition period for the good faith, dispute resolution or record keeping obligations.
This code does not apply to purchasers of horticulture produce who sell directly to consumers.
The full Horticulture Code and obligations are explained on the ACCC website at www.accc.gov.au