January 28, 2015

Good Delivery Guidelines: U.S. vs. Canadian

By: Tom Oliveri

The two primary adjudication services that handle fresh fruit and vegetable disputes are the Perishable Agricultural Commodities Act (PACA) and The Fruit and Vegetable Dispute Resolution Corporation (DRC). The PACA was enacted in 1930 at the request of the fruit and vegetable industry to promote fair trade in the produce industry. The PACA protects businesses dealing in fresh and frozen fruits and vegetables by establishing and enforcing a code of fair business practices and by helping companies resolve business disputes. The DRC is a non-profit, membership-based organization serving the produce trade in the countries of Mexico, United States and Canada. The DRC provides harmonized standards, procedures and services to help avoid commercial disputes. When differences of opinion occur, the DRC provides consultation, mediation and arbitration services to resolve the issue in a timely and cost-effective manner.

The DRC Guidelines for Good Delivery are the same as the Perishable Agricultural Commodities Act (PACA) 5 Day Good Delivery Guidelines except for 30 commodities for which there are minimum standards established under the Canadian Fresh Fruit and Vegetable Regulations. For these specifically named 30 commodities the last column delineates the Canadian Destination Tolerances and Suitable Shipping Condition Guidelines.

In the last column there are five reference numbers in the Canadian Destination Tolerances and Suitable Shipping Condition Guidelines (example 15-10-5-10-4).

  1. The first highlighted number (example 15-10-5-10-4) meaning the total of condition defects allowed in an FOB no grade contract.
  2. The second and third highlighted numbers (example 15-10-5-10-4) refers to quality defects, under in an FOB no grade contract those numbers are not utilized to calculate contract compliance.
  3. The fourth highlighted number (example 15-10-5-10-4) refers to the fact that no individual condition defect can exceed 10%.
  4. The fifth and final highlighted number (example 15-10-5-10-4) is the amount of maximum decay allowed in an FOB no grade contract.

Therefore, when shipping to Canada, under an FOB no grade contract, the condition defect guidelines are the same as the PACA for a five day trip other than the named 30 commodities. The protocols to follow are the PACA Guidelines when shipping to Canada, the only difference being “is that no individual defect can exceed 10%”. Hopefully this general overview will help you to determine if your product meets contract specifications in Canada. After you review the specifications of your commodity, call with any questions at 949 885-2269 or email at TommyO@wga.com.