- Terms of trade are the standard terms and conditions under which a trader is prepared to do business with growers.
- The terms of trade document does not form an agreement between the trader and grower.
- Under the Horticulture Code of Conduct, the trader must ensure their terms of trade are published and made publicly available.
A trader’s terms of trade must not conflict with any part of the Horticulture Code of Conduct.
Terms of trade must contain certain information including:
- if the trader is prepared to act as agent
- if the trader is prepared to act as merchant
- requirements around produce delivery, quality and rejection
- the period within which the trader will pay the grower
- any insurance arrangements for produce while it is under the trader’s control.
For a trader acting as an agent, the terms of trade must also specify:
- commissions, fees and extra costs
- if the agent will pursue bad debts that are owing to a grower and how this will happen.
The terms of trade may include other terms and conditions, as long as they don’t conflict with the horticulture code.
Under the horticulture code, the trader must ensure their terms of trade are published and made publicly available.
This requirement is intended to:
- help a grower understand the services being offered by a trader
- increase market transparency by allowing growers to compare proposed terms and conditions between traders.
Making terms of trade available on a public website is a good way to comply with the code. Many traders choose to publish their terms or trade:
- on their own website, or
- on a third-party website, such as a trader representative group site.
However, the code doesn’t actually define ‘publish and make publicly available’, and it is up to each trader how they meet this requirement.
The ACCC expects that traders will do more than just making terms of trade available upon request, or available at their business premises, especially when not displayed in a location accessible to the public.
Penalties may apply in cases where the terms of trade have not been published and made publicly available.
The terms of trade should be updated to reflect any changes in the terms and conditions on which a trader is prepared to trade.
Traders should publish and make publicly available the update in the same way as the original terms of trade.