WA fruit trader breaches Horticulture Code

A Western Australian based fruit merchant and grower, A. Giumelli & Sons (1989) Pty Ltd, has admitted to a number of breaches of the Horticulture Code of Conduct, a mandatory industry code under the Trade Practices Act 1974.

As a merchant, A. Giumelli & Sons traded with growers but did not have Code compliant horticultural produce agreements in place and did not prepare, publish or make publicly available its general terms of trade.  It also traded as a grower in its own right without having Code compliant agreements with the merchants involved.

A. Giumelli & Sons has acknowledged that its trading with growers and merchants after 14 May 2007 contravened the Code and section 51AD of the Act.  It also acknowledges that its failure to prepare, publish or making publicly available its terms of trade contravened the Code and section 51AD of the Act.

The Australian Competition and Consumer Commission has accepted court enforceable undertakings under section 87B of the Act where A. Giumelli & Sons will:

• not trade in horticulture produce that is subject to the Code without having Code compliant agreements in place
• will prepare, publish and make publicly available its terms of trade
• at its expense, arrange a trade practices seminar on the Code for its management, employees and growers. The seminar will be conducted by a suitable qualified compliance professional or legal practitioner with expertise in trade practices law
• notify its growers about the contraventions of the Code and provide details of the seminar
• provide copies of its Code compliant agreement, terms of trade, and a report on the seminar to the ACCC within specified timeframes, and
• at its expense, publish a notice in the Countryman newspaper about the matter.

A. Giumelli & Sons cooperated with the ACCC in resolving the matter.

ACCC Chairman, Mr Graeme Samuel, reminded the industry that the Code is law and will continue to be enforced by the ACCC.

"The ACCC regards any attempts to deliberately disregard the Horticulture Code very seriously and will not hesitate to take enforcement action, if necessary, through the Federal Court against the merchants and growers involved," Mr Samuel said.

Background

Horticulture Code

On 14 May 2007 the Horticulture Code of Conduct came into effect as a prescribed industry code of conduct under the Trade Practices Act 1974.

The purpose of the Code is to regulate trading in the horticulture produce industry. The Code encourages greater clarity and commercial transparency in trade transactions between growers and wholesale traders by clarifying the responsibilities and obligations of each.

The Code requires that all traders—whether trading as agents or merchants—prepare, publish and make publicly available a document that sets out the general terms and conditions under which they will trade with growers of horticulture produce. The Code sets out the specific requirements for what must be included in the terms of trade document.

The Code also requires that a trader and grower enter a horticulture produce agreement which must be in writing and signed before they trade in horticulture produce with each other. As an agreement between the parties the horticulture produce agreement can contain terms unique to the parties' situation. However, the Code sets out the minimum requirements about what must be included in a horticulture produce agreement.

It is a breach of the Code if growers and merchants trade in horticultural produce without a signed horticulture produce agreement in place.