MPs send produce protection bill to the agriculture committee

Bill passes second reading unanimously.Ottawa—A bill to provide fresh fruit and vegetable growers with financial protection when buyers of their products go bankrupt has received approval in principle from MPs and will be studied by the Commons agriculture committee.The produce industry has been seeking this kind of help since the U.S. in 2014 and the bill from York-Simcoe MP Conservative Scot Davidson passed unanimously although the Liberals expressed misgivings about during debate.Prior to 2014, the sector was covered by an American law when a U.S. buyer went bankrupt. The Harper government would not agree to provide the same protection to U.S. suppliers selling in Canada and Washington ended Canada's special status.The agriculture committee will only four weeks to study the bill before the summer recess so it will likely have to wait until the fall to come to get final approval MPs and go to the Senate for consideration.Dave Epp, Conservative MP for Chatham-Kent-Leamington noted the bill was first introduced in June 2022. Because fresh fruits and vegetables are highly perishable, “it is important for us to protect our farmers during the bankruptcy of a buyer. Unfortunately, current existing laws do not take this into account.”The bill would create “a deemed trust for fresh produce sellers, ensuring they have priority access to an insolvent buyer's assets related to the sale of fresh product. It is important for us to note that the legislation also comes at no cost to the federal government.”A deemed trust mechanism would “address gaps in market stability, trade and food security,” Epp said. “Growing, harvesting, packing and marketing fruits and vegetables comes with risks and costs that are unique to the production of perishable goods and returns on these investments are delayed until payment is collected, which is usually long after the product has been consumed by Canadians or has spoiled due to delayed payment.”The introduction of a financial protection mechanism in Canada would also open the door to the reinstatement of preferential treatment under the U.S.'s Perishable Agriculture Commodities Act for Canadians selling produce into the U.S.BQ MP Yves Perron said the bill would cost the government nothing because it simply gives farmers a priority claim in the event of client bankruptcy or non-payment. Although they voted in favour of the bill, Liberal MPs were quite critical of it during committee hearings.“It would seem that the government is not amenable to this bill, because this sector has been asking for this for years and the government has consistently refused,” Perron said. “This measure would cost nothing and would provide protection for our agricultural producers.”NDP ag critic Alistair MacGregor said fruit and vegetable production can be risky both in production and getting paid as can be seen in the bankruptcy of Lakeside Produce in Leamington.“It has to be clearly underlined that the fresh fruit and vegetable industry has been calling for a statutory deemed trust for payment protection from losses due to buyers defaulting on payment obligations,” he said. “They have been calling for this for a long time, to make sure that we are on par with what our American counterparts enjoy.”