Bill passes second reading unanimously.
Ottawa-All party support in the Commons for a bill to provide fresh fruit and vegetable growers with financial protection when buyers of their products go bankrupt has been welcomed by producers.
The Fruit and Vegetable Growers of Canada (FVGC), the Canadian Produce Marketing Association (CPMA) and the Fruit and Vegetable Dispute Resolution Corporation (DRC) said they were thrilled by the backing for the bill at second reading. The bill, introduced by York-Simcoe Conservative MP Scot Davidson, now will be studied by the Commons agriculture committee.
It is “a crucial step forward in ensuring the financial security of the fruit and vegetable sector,” the groups said. It would create establish a deemed trust, a vital financial protection mechanism for fresh produce sellers in Canada that will help secure payment in the event of buyer bankruptcy. This will provide stability and support to the industry while safeguarding Canadian food security.
Robecca Lee. Executive Director of FVGC, said “For more than three decades, the fresh produce sector has tirelessly advocated for the implementation of a financial protection mechanism. Today, we find ourselves closer than ever to realizing our long-standing goal. This achievement marks a significant leap towards ensuring the security and prosperity of our industry.”
CPMA President Ron Lemaire said, “The significance of this legislation for the fresh produce industry cannot be overstated. As we proceed to the committee stage, we eagerly anticipate further deliberations on the topic of financial protection for fresh produce sellers. We are optimistic about a future where the fresh produce sector thrives through a robust financial protection mechanism, fortifying the sector and ensuring enhanced food security for all Canadians.”
Creation of a deemed trust will have positive impact on the fruit and vegetable sector and the broader Canadian economy, the groups said. It will mirror the successful model employed in the U.S. that presents a financially feasible solution that imposes no additional financial burden on the government. By establishing this trust, fresh produce sellers can continue to contribute to local economies across the country, while providing Canadians with safe and nutritious fruit and vegetable products.
Currently, the perishable nature of fresh produce, coupled with common industry payment terms, leave sellers unable to recover losses when faced with buyer bankruptcy. The recent case of Lakeside Produce in Leamington serves as a reminder of the urgent need for a financial protection tool to safeguard this essential sector and uphold food security in Canada, the groups said.