Author: DRC

We often receive questions from DRC members asking about how to properly read a CFIA inspection. In this three part series, we will look at the importance of reviewing the information on the inspection certificate. To begin, let’s focus on the elements in the first section as well as the product description section.

The first section of the certificate contains the “requested and performed date and time” for the inspection. This information is important because it helps to establish if the inspection was requested and performed in a timely manner. For example, truck shipments require the inspection to be requested within 8 working hours after the receiver is given notice of arrival and the produce is made accessible for inspection. Boat and rail shipments however allow the inspection to be requested within 24 working hours after the receiver is given notice of arrival and the product has been placed in a location where the produce is made accessible for inspection.

The field “where inspected” indicates the area the inspection took place such as the applicant’s warehouse, the consignee’s warehouse, or any other location. If the product was still loaded when the inspector arrived on site, that information should be noted under the “remarks” section.

An important area to review is the “remarks” section at the bottom of the inspection certificate which will include notes the inspector has made about the location of the load, if it was still loaded on the truck or if it was unloaded. This could help determine if the buyer/receiver still has the right to reject the product. For information on “Acts of Acceptance” please review Section 19.1 of the DRC Trading Standards

Information about the applicant, shipper and consignee

The information in this section identifies the parties involved in the transaction. If there is a name under any of these fields with which you are not familiar, you will want to address this with your customer.

Product description

This section should include detailed information about the load such as product, variety, size, maturity, grade and colour, packages (number of cartons or bags available for inspection), type of count and weight.

This information needs to match your invoice and/or purchase order. For example, if you receive a load of different size mangoes at a different price per unit, a discussion for a request for an inspection by size needs to occur.

Another major issue that we often see is the number of cartons inspected. The entire load should be available for inspection. If not, the buyer/receiver needs to have a valid reason as to why the full load was not available.

As a general rule more than 75% of the load must be available for sampling to be considered representative of the full load.

In part 2 of our series on how to properly read an inspection certificate, we will review temperatures and defects.

The proposed Safe Food for Canadians Regulations (SFCR) are expected to come into force late spring or early summer. Once implemented, a DRC membership is mandatory for Canadians to buy, sell, import or export fresh fruits and vegetables. Under the existing Canada Agricultural Products Act (CAP Act), the current requirement is to secure either a CFIA Produce Licence or a DRC membership to be in regulatory compliance. Under the new regulations, there will only be one option: a DRC membership. This change will require some modifications to the way DRC currently conducts business.

We will be proposing housekeeping changes to the DRC By-laws and related in-house administrative procedures at our next Annual General Meeting (AGM) of Members in June 2018. These changes relate primarily to increasing the transparency of our membership application and membership maintenance processes. As we get closer to the AGM and in keeping with current By-laws, we will provide members with the proposed changes along with explanatory notes to help members understand the new By-law changes and how they will work on a day-to-day basis.

Hopefully you have been able to take part in some of our recent outreach activities. If you haven’t but are interested in learning more about the proposed SFCR, please contact our office we will be happy to help walk you through the draft regulations.

For additional information please contact:

DRC Help Desk | 613-234-0982 | [email protected]

Implementation of the Safe Food for Canadians Regulations (SFCR) is quickly approaching and with it, the regulatory requirement for a DRC membership for Canadians.

SFCR is expected to come into force late spring or early summer. Once implemented, a DRC membership is mandatory for Canadians who buy, sell, import or export fresh fruits and vegetables with few exceptions (see below for link to determine if you are exempt).

Under the existing Canada Agricultural Products Act (CAP Act), the current requirement is to secure either a CFIA Produce Licence or a DRC membership to be in regulatory compliance. Under the new regulations, there will only be one option: a DRC membership.

When it comes to SFCR, there are important distinctions: the regulations address food safety and traceability (Canadian Food Inspection Agency (CFIA) licence) as well as trade and commerce (a DRC membership is required to engage in the trade of fresh fruits and vegetables). All references to licence in the SFCR pertain to food safety and traceability; reference to a DRC membership pertains to trade and commerce. DRC’s role and responsibility within SFCR relate only to trade and commerce.

What do Canadians need to do?

1. Be aware of, and understand, the SFCR regulatory requirement for a DRC membership to buy, sell, import or export fresh fruits and vegetables.
2. Visit the DRC website and refer to the self-assessment tools to determine whether you are subject to the regulatory requirement or are exempt. https://fvdrc.com/sfcr/

If you are exporting to Canada, ensure that you sell to or buy from a DRC member.

For additional information or to schedule a presentation from a DRC team member, please contact:

DRC Help Desk | 613-234-0982 | [email protected]

Most disputes between members are solved with the help of DRC Staff during the informal consultation process. Some disputes however end up in the formal process where an arbitrator is appointed with the cooperation of the claimant and the respondent. That arbitrator must make a decision based on what is presented to them by the parties. We have seen some arbitration cases where if the claimant or the respondent had made a better presentation to the arbitrator, the arbitrator might have reconsidered their decision.

1. The informal file handled by DRC staff is closed and the arbitrator does not see it.
   During the informal process many documents and issues are exchanged and explored.  The informality of this process allows the parties to go back and forth several times, review information, and make offers or counter offers. Firms may also discover an error or a new issue during this exchange. For the above reasons the informal file is sealed to avoid misleading the arbitrator. Do not assume that the arbitrator will have access to the information submitted during the informal consultation process. You have to make sure you resubmit all the information favouring your claim or defence.

2. A party refers to a contract or other document but fails to provide it.
   Parties often reference agreements, contracts, emails, market reports, etc. in presenting their case.  A statement without supporting documentation is of limited evidentiary value, especially when the other party has presented documentation in support of their position. If you are referencing a document, ensure it makes it to your exhibits when presenting your case.

3. A party assumes the arbitrator has specific knowledge of a particular issue.
   The arbitrators that are selected for DRC cases are familiar with the industry and DRC rules.   They cannot however be expected to know everything about every commodity or unique steps in the supply chain.  An arbitrator is no different than a judge in court; they are not going to investigate or make your case for you. You are responsible to make and defend your own case.

Obviously, no one likes to lose a case. Unfortunately, we do see cases where a party fails to prevail in their case not because of what they presented, but because of what they failed to present. It is unfortunate when a case is lost not on its merits, but rather because essential material was not provided to the arbitrator. Be prepared and avoid these top three pitfalls.

The vast majority of problems brought to us by our members are resolved with a bit of sound advice or an exchange of information in our informal process. Some issues however, do proceed to the formal process where an arbitrator is required to issue a final decision.

The Formal Mediation and Arbitration Rules have remained largely unchanged for 17 years and we believe a review and update is timely. Members and our roster of independent arbitrators have indicated to us that the rules are a bit cumbersome and repetitive. We have therefore retained a leading Arbitration Law and process expert to revise those rules.

Currently there are three categories of arbitration in our rules:

Those less than $15,000

Those from $15000 to $50,000

Those over $50,000

The proposed revisions to the rules will remove repetitive language in the current version and highlight differences within the categories. Examples of highlights would include whether or not a hearing is required and timelines for responses. Several areas will also be clarified to make them easier to understand and follow.

Please note that the current rules remain in full force and no changes will be implemented until they have been presented and approved by the Board of Directors later this year. Should the revisions be approved, we will provide the membership with the changes, answer any questions, and share the date the changes will be implemented.

For now, there are no changes to the Formal Mediation and Arbitration Rules, and this note is merely advance notice that a review is underway and changes may be forthcoming.

DRC Help Desk | 613-234-0982 | [email protected]

Are you subject to the proposed CFIA regulatory requirement for a DRC membership? Is DRC membership right for you? Are you taking full advantage of all of your DRC member benefits? These are just a few of the questions you should be asking your DRC support team and we’re making it easy to do so.

DRC will be exhibiting at many regional meetings and will be available at trade shows.

This month look for us at the Ontario Fruit and Vegetable Convention, February 21-22, at the Scotiabank Convention Centre in Niagara Falls, Ontario.

Visit DRC at Booth #428 to learn about proposed regulatory requirements expected to come into force in 2018. DRC membership will be required to buy, sell, import or export fresh fruits and vegetables unless otherwise exempted as per the proposed regulations. This will result in a requirement for a mandatory membership in the DRC for some who were not previously subject to the requirements of the CFIA Licensing and Arbitration Regulations.

DRC team members will be on hand to discuss the full range of member benefits including: harmonized standards, procedures and services necessary to avoid and resolve commercial disputes in a timely and cost-effective manner. Make sure you’re taking full advantage of all the services and benefits DRC membership has to offer.

Contact the DRC Help Desk today to schedule an appointment during the convention or simply stop by Booth #428 to meet with a DRC team member:

DRC Help Desk | (+1) 613-234-0982 | [email protected]

Additional details about the convention can be found at: http://www.ofvc.ca/

A friendly reminder that a few of you have DRC membership fees that are past due. Failure to pay your annual membership dues may result in termination of your membership in accordance with the By-laws of the Corporation.

In order to stay in good standing, if you have yet to pay your yearly membership fees, please contact us asap at:

DRC Help Desk | 613-234-0982 | [email protected]

Q. I am a DRC member, what happens when I have a dispute with a company that is not a DRC member?

A: DRC members are expected to abide by certain rules and responsibilities and when a dispute occurs between members, we are here to help. Unless your trading partner is a DRC member, we may be limited in the assistance we can provide. Should a dispute occur between a DRC member and a non-member, we may be able to assist if the non-member signs a voluntary arbitration agreement that will bind them to a final decision by an arbitrator if necessary.

If the non-member signs the voluntary agreement, one of two steps needs to occur. The non-member needs to join DRC or, alternatively, pay a set fee. Once one of the two steps is completed, it is treated as if both parties are DRC members and the dispute process should move forward as normal.

In the absence of a signed voluntary arbitration agreement, because one party is not a DRC member, the option of litigation is a strong possibility. We would like to remind all DRC members to encourage trading partners to join DRC.

For more information please call or email the DRC Help Desk at:

DRC Help Desk | 613-234-0982 | [email protected]

We were contacted recently by one of our members asking about DRC’s point of view regarding differences between a temperature recorder and a real time temperature recorder.  Real time temperature recorders are those which are GPS enabled and can be monitored remotely.  This technology has been available in our industry for a few years now and in our experience, a real time temperature recorder brings additional advantages over a regular temperature recorder. To mentioned a few:

• If a temperature recorder is lost, no data is available. For a real time temperature recorder, data is always available even when real time recorder is lost.
• Location of the load in transit.
• Alert system to indicate temperatures during transit have passed the set temperature range.
• Can avoid temperature impact on product while in transit.
• Anyone can have access to the data as long as certain information such as the serial number is provided.

Simultaneously, a real time temperature recorder also brings additional responsibilities to those who have access to the real time data. The real time data from these devices is considered evidence of the temperatures in transit, just like a tape or digital readout from a traditional temperature recorder. The main difference is, if you become aware of a temperature problem in transit and nothing is done about it, all those who had access could  take on liability for not taking steps to limit or stop  potential deterioration to the product.

For more information please call or email the DRC Help Desk at:

DRC Help Desk | 613-234-0982 | [email protected]