Recent breaches of the Horticulture Code of Conduct have resulted in significant penalties for traders. In 2023, several companies, including Nutrano, GetFresh Merchants, and Total Food Network Australia, faced fines ranging from $24,850 to $43,150 for violations such as failing to enter into compliant Horticulture Produce Agreements (HPAs), not publishing terms of trade, and neglecting mandatory reporting requirements. These penalties highlight the increasing enforcement focus of the Australian Competition and Consumer Commission (ACCC) and the costly consequences of non-compliance.
The ACCC has made it clear that ignorance of the law is no excuse, and traders who fail to meet their obligations under the Horticulture Code of Conduct (Code) risk significant financial and reputational damage. But what exactly does compliance look like, and how can you avoid falling foul of the Code?
Understanding the Horticulture Produce Agreement (HPA)
A HPA is a written agreement between growers and traders (agents or merchants) that outlines the terms of growing, harvesting, marketing, or selling horticultural produce. It is a legal requirement under the Code, a mandatory industry code prescribed under the Competition and Consumer Act 2010 (CCA).
This article delves into the key components of a compliant HPA, the consequences of non-compliance, and the steps traders and growers must take to ensure their agreements meet legal standards. Read on to ensure your practices align with the law—and avoid becoming the ACCC’s next target.
What is a Horticulture Produce Agreement?
A HPA is a written contract between growers and traders (either agents or merchants) of horticulture produce. It sets out the terms and conditions under which the produce will be grown, harvested, marketed, or sold.
HPAs are governed by the Horticulture Code of Conduct (the Code), a mandatory industry code under the CCA. The Code promotes transparency and fairness in transactions and provides dispute resolution procedures for issues arising under the Code or an HPA.
The ACCC enforces the Code, ensuring compliance and protecting competition and consumer rights in the horticulture industry.
What Happens if the Code is Breached?
The Code mandates that growers and traders must have a compliant HPA in place before trading begins. Non-compliance, such as trading without an HPA or having a non-compliant HPA, can result in civil penalties or infringement notices.
Recent Breaches and Penalties
Ensuring compliance with the Code is crucial for fair trading practices in the horticulture industry. Recent enforcement actions by the ACCC) highlight the importance of having a compliant HPA.
Recent Enforcement Actions:
Is Your HPA Compliant?
To comply with the Code, a HPA must meet specific requirements to ensure transparency and fairness between growers and traders.
Key Elements of a Compliant HPA:
Final Notes:
Non-compliance with the Horticulture Code can result in significant penalties, as demonstrated by recent ACCC enforcement actions. To ensure your Horticulture Produce Agreement is compliant and to avoid potential penalties, it is advisable to seek professional guidance.
For expert advice and assistance in drafting or reviewing your HPA, please contact Georgina Parisis or Tom White in our Agribusiness Team.
Disclaimer: The information provided above is for general informational purposes only and does not constitute legal advice. While we have made every effort to ensure the accuracy and reliability of the content, it is not intended to replace professional legal advice tailored to your specific circumstances. Agribusinesses are encouraged to seek advice from qualified legal professionals to ensure compliance with relevant laws and regulations. We do not accept any liability for actions taken based on the information provided in this document.