Agricultural Marketing Programs Act (S.C. 1997, c. 20)

Short Title

Marginal note:Short title

1 This Act may be cited as the Agricultural Marketing Programs Act.

Interpretation

Marginal note:Definitions

• 2 (1) The definitions in this subsection apply in this Act.

  administrator

  administrator means one of the following organizations, if it has the power to sue and be sued in its own name:

  • (a) an organization of producers that is involved in marketing an agricultural product to which Part I applies;

  • (b) an organization, other than a lender, that the Minister, taking into account any criteria prescribed by regulation, determines to be an organization that represents producers who produce, in an area, a significant portion of an agricultural product to which Part I applies; or

  • (c) an organization, including a lender, that the Minister determines to be an organization that would be able to make advances more accessible to producers and that the Minister designates as an administrator. (agent d’exécution)

  advance

  advance means an advance payment to an eligible producer for an agricultural product. (avance)

  advance guarantee agreement

  advance guarantee agreement means an agreement under section 5. (accord de garantie d’avance)

  agricultural product

  agricultural product means an animal or a plant or a product, including any food or drink, that is wholly or partly derived from an animal or a plant. (produit agricole)

  Board

  Board[Repealed, 2011, c. 25, s. 16]

  crop

  crop[Repealed, 2006, c. 3, s. 1]

  crop unit

  crop unit[Repealed, 2006, c. 3, s. 1]

  crop year

  crop year[Repealed, 2006, c. 3, s. 1]

  Her Majesty

  Her Majesty means Her Majesty in right of Canada. (Sa Majesté)

  lender

  lender means a financial institution, as defined in section 2 of the Bank Act, or any other legal entity that the Minister of Finance may designate for the purposes of this Act on the application of that entity. (prêteur)

  livestock

  livestock means cattle, sheep, swine and bison and any other animals that may be designated by regulation. (bétail)

  marketing agency

  marketing agency means

  • (a) an association of producers whose object is the marketing, under a cooperative plan, of agricultural products produced by the producers;

  • (b) a person engaged in the processing of agricultural products for marketing under a cooperative plan; or

  • (c) a person authorized by one or more associations or persons mentioned in paragraphs (a) and (b) to market agricultural products under a single cooperative plan. (agence de commercialisation)

  • (d) [Repealed, 2011, c. 25, s. 16]

  Minister

  Minister means the Minister of Agriculture and Agri-Food. (ministre)

  permit book

  permit book[Repealed, 2011, c. 25, s. 16]

  price guarantee agreement

  price guarantee agreement means an agreement under section 28. (accord de garantie des prix)

  producer

  producer means a producer of an agricultural product who is

  • (a) a Canadian citizen or a permanent resident within the meaning of subsection 2(1) of the Immigration and Refugee Protection Act;

  • (b) a corporation that is controlled by one or more of the persons or entities referred to in paragraphs (a), (c) and (d);

  • (c) a cooperative a majority of whose members are Canadian citizens or permanent residents; or

  • (d) a partnership or other association of persons where partners or members who are Canadian citizens or permanent residents are entitled to at least 50% of the profits of the partnership or association. (producteur)

  production period

  production period, in respect of an agricultural product, means the period of up to 18 months — or any longer period that is fixed by the Minister — specified in the advance guarantee agreement relating to the agricultural product. (campagne agricole)

  production unit

  production unit, in respect of an agricultural product, means the production unit specified in the advance guarantee agreement relating to the agricultural product. (unité de production)

  program year

  program year, in respect of an advance, means the period that is specified in the advance guarantee agreement and the repayment agreement that relates to the advance. (année de programme)

  repayment agreement

  repayment agreement means an agreement under subsection 10(2). (accord de remboursement)

• Marginal note:Interpretation

  (2) For the purpose of paragraph (b) of the definition producer in subsection (1), a corporation is controlled by a person or entity if the corporation is controlled in any manner that results in control in fact, whether directly through the ownership of voting shares or indirectly through a trustee or other person who administers the property of another, a legal representative, an agent or mandatary or other intermediary acting as nominee or otherwise, a trust, a contract, the ownership of a corporation or otherwise.

Marginal note:Related producers

• 3 (1) Producers are related for the purposes of this Act if they do not deal with each other at arm’s length.

• Marginal note:Presumption

  (2) In the absence of proof to the contrary, a producer is presumed to be related to another producer in any of the following circumstances:

  • (a) the producer controls, directly or indirectly in any manner, the other producer;

  • (b) the producer is controlled, directly or indirectly in any manner, by the same person or group of persons as the other producer;

  • (c) the producer carries on a farming operation in partnership with the other producer;

  • (d) the producer shares any management services, administrative services, equipment, facilities or overhead expenses of a farming operation with the other producer, but is not in partnership with that other producer;

  • (e) any other circumstances set out in the regulations.

• Definition of group of persons

  (3) For the purposes of subsection (2), group of persons means a producer that is a partnership, cooperative or other association of persons.

PART IAdvance Payments Program

Advance Guarantee Agreements

Marginal note:Purpose

4 The purpose of this Part is to improve marketing opportunities for the agricultural products of eligible producers by guaranteeing the repayment of the advances made to them as a means of improving their cash-flow.

Marginal note:Eligible agricultural products

• 4.1 (1) Subject to subsections (2) and (3), this Part applies only in respect of an agricultural product that meets the following criteria:

  • (a) the agricultural product is

    • (i) an animal that is raised in Canada or the fur pelt of such an animal,

    • (ii) a plant that is grown in Canada or the product of such a plant, or

    • (iii) honey or maple syrup that is produced in Canada;

  • (b) the Minister has determined, taking into account any criteria prescribed by regulation, that it is possible to establish an average price for the agricultural product; and

  • (c) the Minister has determined, taking into account any criteria prescribed by regulation, that the agricultural product is not processed or, in the case of a perishable agricultural product, is not processed beyond what is necessary to store it and prevent spoilage.

• Marginal note:Breeding animals

  (2) Subject to any regulations made under paragraph (3)(b), animals that are or were used as breeding animals are not agricultural products that are subject to this Part.

• Marginal note:Regulations

  (3) The Governor in Council may make regulations

  • (a) designating any agricultural product as being subject to this Part; and

  • (b) designating any breeding animals or classes of breeding animals as being subject to this Part and respecting any conditions related to that designation.

Marginal note:Agreements to guarantee repayment of advances

• 5 (1) Subject to the other provisions of this Act, the Minister may make an agreement with an administrator or with an administrator and a lender for the purposes of

  • (a) guaranteeing to the administrator or, if the agreement is made with an administrator and a lender, to the lender, the repayment of advances that the administrator makes to eligible producers from money borrowed for the purpose of making the advances, together with any interest on the advances; and

  • (b) setting out the obligations of the administrator in relation to the advances and their repayment.

• Marginal note:Restriction

  (1.1) An advance guarantee agreement may be made with an administrator and a lender, or with an administrator that is a lender, only if the Minister is satisfied that doing so will reduce the interest payable to the lender and the agreement is made subject to terms and conditions approved by the Minister of Finance.

• Marginal note:Conditions concerning the guarantee

  (1.2) If a guarantee under the advance guarantee agreement is made to a lender, or to an administrator that is a lender, the agreement must provide, in addition to any other terms and conditions, that the interest rate on the money provided by the lender, or by the administrator, as the case may be, will not exceed the rate specified in the agreement.

• Marginal note:Administrator to demonstrate ability

  (2) An administrator must demonstrate to the Minister that it is capable of meeting its obligations under the advance guarantee agreement.

• Marginal note:Terms and conditions

  (3) In addition to identifying the agricultural products and specifying the terms and conditions governing advances and their repayment, an advance guarantee agreement must provide that the administrator agrees

  • (a) to make an agreement with each buyer mentioned in subparagraph 10(2)(a)(i), other than the administrator, to withhold amounts as provided in that subparagraph and to remit them immediately to the administrator;

  • (b) to withhold amounts as provided in subparagraph 10(2)(a)(i) in cases where the administrator is the buyer;

  • (c) to make the advances from money borrowed from a lender;

  • (d) to ensure that the interest rate on the money borrowed by the administrator will not exceed the rate specified in the advance guarantee agreement;

  • (e) to take steps, in accordance with the advance guarantee agreement, to ensure that, before an advance is made

    • (i) in the case of an agricultural product that is storable,

      • (A) it is of marketable quality and stored so as to remain of marketable quality until disposed of in accordance with the repayment agreement, or

      • (B) if it is in the course of being produced or is not yet produced, either the amount of the advance is covered by a program listed in the schedule and the amounts that may be received under that program are assignable or the amount of the advance is covered by the security referred to in section 12,

    • (ii) in the case of an agricultural product that is not storable,

      • (A) it is of marketable quality and maintained so as to remain of marketable quality until disposed of in accordance with the repayment agreement and either the amount of the advance is covered by a program listed in the schedule and the amounts that may be received under that program are assignable or the amount of the advance is covered by the security referred to in section 12, or

      • (B) if it is in the course of being produced or is not yet produced, either the amount of the advance is covered by a program listed in the schedule and the amounts that may be received under that program are assignable or the amount of the advance is covered by the security referred to in section 12, and

    • (iii) despite subparagraphs (i) and (ii), in the case of an agricultural product that is livestock, it is of marketable quality and maintained so as to remain of marketable quality until disposed of in accordance with the repayment agreement;

  • (f) to repay the money it borrows from the lender, together with the interest, by paying to the lender, within the period specified in the advance guarantee agreement, the amounts the administrator receives as repayment of advances;

  • (g) [Repealed, 2015, c. 2, s. 124]

  • (h) to pay to the Minister any additional interest resulting from its failure to make payments required by paragraph (f);

  • (h.1) after the administrator receives the payment of interest referred to in subparagraph 10(2)(a)(v), to pay to the Minister, within the period specified in the advance guarantee agreement, any interest paid by the Minister under subsection 9(1) on the amount of an advance that is repaid by a producer to the administrator without proof that the agricultural product has been sold;

  • (i) to pay to the Minister, within the period specified in the advance guarantee agreement, the amount repaid to the administrator under a repayment agreement by a defaulting producer if the Minister has previously made a payment for the producer under subsection 23(1) or (1.1); and

  • (j) to assign, on the Minister’s request and within any period that the Minister specifies, its rights and obligations under the advance guarantee agreement to any entity that the Minister specifies, if the administrator has not met all of its obligations under the agreement and the Minister has sent a notice to the administrator stating that the administrator has had, in the Minister’s opinion, adequate opportunity to meet the obligations, and requesting the administrator to meet them.

• Marginal note:Specific terms and conditions

  (3.01) An advance guarantee agreement may include any of the following terms and conditions governing advances and their repayment:

  • (a) the administrator must agree to make advances to producers solely in the areas specified in the agreement;

  • (b) the administrator must agree to make advances to producers solely in relation to the agricultural product specified in the agreement;

  • (c) the producer must agree to inform the administrator of the producer’s participation in any program listed in the schedule; and

  • (d) the producer must agree to assign, if in default, any amounts payable to the producer under a program listed in the schedule to

    • (i) the administrator, to the extent of the producer’s liability under section 22, and

    • (ii) the Minister, to the extent of the producer’s liability under section 23.

• Marginal note:Designation by Minister

  (3.02) The Minister may designate, in the advance guarantee agreement with the administrator, agricultural products or classes of agricultural products with respect to which an amount of an advance may be repaid, without proof that the agricultural product has been sold, before the expiry of the production period for which the advance was made.

• Marginal note:Exception

  (3.1) The terms described in paragraphs (3)(c) and (f) — and in paragraph (3)(h) in relation to payments required by paragraph (3)(f) — are not required if the Minister and an administrator are the only parties to the agreement.

• Marginal note:Schedule

  (3.2) The Governor in Council may, by regulation, on the recommendation of the Minister, amend the schedule by adding to it, or deleting from it, the name of a program.

• Marginal note:Restriction

  (3.3) An amendment to an advance guarantee agreement may not be made during the period specified in it that constitutes the production period if doing so would extend that period beyond 18 months, or the longer period fixed by the Minister, if one was so fixed before the advance guarantee agreement was entered into.

• Marginal note:Recovery of costs

  (4) The administrator may, subject to any terms and conditions of the advance guarantee agreement, charge fees to producers for the purpose of recovering any costs under this Part, including costs related to the recovery of outstanding amounts from producers who are in default under a repayment agreement and costs of receiving and dealing with applications for advances, administering advances and any other administrative services.

• Marginal note:Maximum contingent liability

  (5) The aggregate contingent liability of Her Majesty in relation to the principal outstanding under guarantees made under advance guarantee agreements must not at any time exceed $5 billion or the amount fixed by regulation.

• Marginal note:Amounts withheld from advance

  (6) The administrator may, with the Minister’s approval, withhold amounts from an advance made to a producer for a purpose authorized under the advance guarantee agreement.