4. The Minister’s percentage mentioned in paragraph 5(3)(i) and subsection 23(1) of the Act is 100% of the producer’s liability, minus the administrator’s percentage calculated under section 3.

5. For the purposes of paragraphs 9(2)(c) and 20(2)(c) of the Act, the attributable percentage of an amount advanced to a cooperative is the percentage calculated by dividing 100 by the number of members of the cooperative.

6. For the purposes of subparagraph 10(2)(a)(v) of the Act, the amount prescribed is the amount that is the greater of

• (a) 10% of the advance, and

• (b) $1,000.

• 6.1 (1) For the purposes of paragraph 10(2)(c) of the Act, “overpayment” means

  • (a) in the case where an advance is covered by a program listed in the schedule to the Act, where the coverage amount payable to the producer under the program is reduced through no fault of the producer and where section 11 of the Act does not apply, that part of the outstanding amount of the advance that exceeds the reduced coverage amount by more than the limit determined in accordance with subsection (2); and

  • (b) in the case where an advance is in respect of an agricultural product that, at the time of the advance, was in the course of being produced or was not yet produced, where the value of the produced agricultural product – and the value of the security on the produced agricultural product – is reduced through no fault of the producer and where section 11 of the Act does not apply, that part of the outstanding amount of the advance that exceeds the reduced value of the security by more than the limit determined in accordance with subsection (2).

• (2) The limit is the amount that is the greater of

  • (a) 10% of the advance, and

  • (b) $6,000.

• (3) In any case where both paragraphs (1)(a) and (b) apply to an advance, “overpayment” means the amount calculated in accordance with paragraph (1)(b).

6.2 For the purposes of section 12 of the Act, the required security is one or a combination of the following:

• (a) security referred to in section 427 of the Bank Act;

• (b) security under applicable provincial law; and

• (c) a full or partial assignment.

• 7. (1) No payment under subsection 23(1) of the Act may be made to a lender or administrator unless

  • (a) the Minister receives a request in writing from the administrator for payment;

  • (b) the administrator,

    • (i) if the advance guarantee agreement sets out the procedures to be followed in the event of default on the repayment agreement or the death of the producer, or in the event that the administrator has reasonable grounds to believe that an offence under the Act has been committed by the producer, demonstrates that it followed those procedures,

    • (ii) after receiving notice that the producer has made an assignment under the Bankruptcy and Insolvency Act or that the producer is subject to a receiving order, files with the appropriate authority a notice of their claim against the assets of the producer and provides a copy of that notice to the Minister,

    • (iii) after being informed that the producer has died, files with the executor or administrator of the producer’s estate a notice of the debt and provides a copy of that notice to the Minister,

    • (iv) if the administrator has reasonable grounds to believe that an offence under this Act has been committed, reports the particulars to the appropriate police authority and provides a copy of that report to the Minister, or

    • (v) in any other case, provides

      • (A) copies of three letters of demand for payment that have been sent to the producer,

      • (B) proof that the administrator made or attempted to make a personal visit or telephone call to the producer, and

      • (C) a detailed description of the attempts at mediation or other methods used to negotiate the terms for repayment; and

  • (c) the administrator provides to the Minister an undertaking in writing to

    • (i) take all reasonable measures in the future to recover from the producer any amounts still owed, and

    • (ii) advise the Minister of all opportunities for collection as they arise.

  • (d) [Repealed, SOR/2006-293, s. 5]

• (1.1) In the case where the administrator is the Board, before requesting payment from the Minister under subsection 23(1) of the Act, the Board shall undertake to the Minister in writing to continue to collect, during the period specified in the advance guarantee agreement, any amounts still owed by the producer by endorsing the documents referred to in section 16 of the Act or by offsetting payments to producers.

• (2) Despite paragraph (1)(a), payment under subsection 23(1) of the Act may be made to a lender if

  • (a) the administrator has not made a request in writing to the Minister for payment within 10 months after the end of the production period specified in the advance guarantee agreement;

  • (b) after the 10 month-period referred to in paragraph (a), the lender has submitted a letter to the administrator asking that the administrator request in writing payment from the Minister as specified in the advance guarantee agreement;

  • (c) the administrator has failed to comply with the request referred to in paragraph (b) within 10 days after the date on which the letter was sent; and

  • (d) the lender submits a request in writing to the Minister for payment

    • (i) stating that the lender has written to the administrator asking that the administrator request in writing payment from the Minister and that the administrator has failed to comply within 10 days after the date on which the letter was sent,

    • (ii) providing the Minister with a copy of the letter to the administrator, and

    • (iii) specifying the name and address of the producer in default and the amount of the default.