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

  agent d’exécution

  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, including the Board but not including 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 for which advances will be made; 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

  avance

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

  advance guarantee agreement

  accord de garantie d’avance

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

  agricultural product

  produit agricole

  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

  Commission

  Board means the Canadian Wheat Board continued by section 3 of the Canadian Wheat Board Act. (Commission)

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  crop[Repealed, 2006, c. 3, s. 1]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  crop unit[Repealed, 2006, c. 3, s. 1]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  crop year[Repealed, 2006, c. 3, s. 1]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

  Sa Majesté

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

  lender

  prêteur

  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

  bétail

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

  marketing agency

  agence de commercialisation

  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;

  • (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; or

  • (d) the Board. (agence de commercialisation)

  Minister

  ministre

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

  permit book

  carnet de livraison

  permit book means a permit book, as defined in subsection 2(1) of the Canadian Wheat Board Act. (carnet de livraison)

  price guarantee agreement

  accord de garantie des prix

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

  producer

  producteur

  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 a majority of whose voting shares are held by Canadian citizens or permanent residents;

  • (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.

  For the purposes of Parts I and IV, producer includes a person or entity mentioned in any of paragraphs (a) to (d) that is entitled to an agricultural product or a share in it as lessor, vendor, mortgagee or hypothecary creditor on a date specified for the purposes of this definition in an advance guarantee agreement. (producteur)

  production period

  campagne agricole

  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

  unité de production

  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)

  repayment agreement

  accord de remboursement

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

• (2) [Repealed, 2006, c. 3, s. 1]

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, producers are presumed not to deal with each other at arm’s length if they are related as follows:

  • (a) individuals who are cohabiting or are connected by

    • (i) blood relationship, in the sense that one is the child or other descendant of the other or one is the brother or sister of the other,

    • (ii) marriage, in the sense that one is married to the other or to a person who is connected with the other by blood relationship or adoption,

    • (ii.1) common-law partnership, in the sense that one is in a common-law partnership with the other or with a person who is connected with the other by blood relationship or adoption, or

    • (iii) adoption, in the sense that one has been adopted, either legally or in fact, as the child of the other or as the child of a person who is connected with the other by blood relationship, otherwise than as a brother or sister;

  • (b) a corporation and a person who

    • (i) holds shares in the corporation,

    • (ii) is a member of a group of persons that holds shares in the corporation, or

    • (iii) is related, as described elsewhere in this subsection, to a person who holds shares in the corporation or to the member of the group;

  • (c) any two corporations if

    • (i) one person or group of persons holds shares in both corporations,

    • (ii) a person who holds shares in one of the corporations is related, as described elsewhere in this subsection, to a person who holds shares in the other corporation,

    • (iii) a person who holds shares in one of the corporations is related, as described elsewhere in this subsection, to a member of a group of persons that holds shares in the other corporation, or

    • (iv) they are both related, as described in paragraph (b) or subparagraph (i), (ii) or (iii), to a third corporation;

  • (d) members of the same group of persons; or

  • (e) persons related, as described in paragraphs (a) to (c), to members of the same group of persons.

• Marginal note:Definitions

  (3) For the purposes of subsection (2),

  common-law partnership

  union de fait

  common-law partnership means the relationship between two persons who are cohabiting in a conjugal relationship, having so cohabited for a period of at least one year; (union de fait)

  group of persons

  groupe

  group of persons means a producer that is a partnership, cooperative or other association of persons. (groupe)

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:Designation by Governor in Council

  (2) The Governor in Council may, by regulation, designate any other agricultural product as being subject to this Part.

• Marginal note:Breeding animals

  (3) Animals that are or were used as breeding animals are not agricultural products that are subject to this Part.

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 terms and conditions of the advance guarantee agreement, to ensure that, before an advance is made,

    • (i) in the case of an agricultural product that is storable, it is of marketable quality and stored so as to remain of marketable quality until disposed of in accordance with the repayment agreement or, if that agricultural product is in the course of being produced, or is not yet produced, the amount of the advance is covered by a program listed in the schedule and amounts that may be received under that program are assignable,

    • (ii) in the case of an agricultural product that is not storable, it is of marketable quality and maintained so as to remain of marketable quality until disposed of in accordance with the repayment agreement, the amount of the advance is covered by a program listed in the schedule and amounts that may be received under that program are assignable or, if that agricultural product is in the course of being produced, or is not yet produced, the amount of the advance is covered by a program listed in the schedule and amounts that may be received under that program are assignable, 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) if a producer defaults, to pay

    • (i) to the lender, within the period specified in the advance guarantee agreement, the administrator’s percentage, as determined under the regulations, of the amount of the producer’s liability under paragraph 22(a), and

    • (ii) to the Minister within the same period the same percentage of the amount of interest paid by the Minister under subsection 9(1);

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

  • (i) to pay to the Minister, within the period specified in the advance guarantee agreement, the Minister’s percentage, as determined under the regulations, of an 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).

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

  • (b) 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:Exception

  (3.1) The terms described in paragraphs (3)(c) and (f) and subparagraph (3)(g)(i) — and in paragraph (3)(h) in relation to payments required by paragraph (3)(f) and subparagraph (3)(g)(i) — 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:Administration fees

  (4) The administrator may charge fees to producers for administrative services, including fees for receiving and dealing with applications for advances and for administering advances. The fees may be charged only for the purpose of recovering administrative costs under this Part and are subject to any terms and conditions of the advance guarantee agreement.

• 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:Administrator’s percentage

  (6) The administrator’s percentage mentioned in paragraph (3)(g), as determined under the regulations, must be at least 1% and not more than 15%. If the regulations establish a method of calculating that percentage, the percentage is deemed to be 1% if the calculation results in a lower percentage, and 15% if the calculation results in a higher percentage.

Marginal note:Agreement where guarantee already exists

• 5.1 (1) The Minister may enter into an advance guarantee agreement with an administrator without making the guarantee referred to in paragraph 5(1)(a) if the Minister is satisfied that the repayment of the advances to be made under the agreement will be guaranteed by another person or entity.

• Marginal note:Provisions do not apply

  (2) Paragraph 5(3)(i), section 23 and, unless the agreement specifies otherwise, the following provisions do not apply to an advance guarantee agreement that the Minister enters into without making the guarantee referred to in paragraph 5(1)(a):

  • (a) paragraphs 5(3)(c) and (e) to (h);

  • (b) paragraphs 10(1)(g) and (h); and

  • (c) paragraphs 10(2)(b) and (c).

Marginal note:Obligations of administrators

6 A guarantee given to an administrator is not effective unless the administrator complies with this Act and the advance guarantee agreement.

Marginal note:Emergency advance

• 7 (1) The advance guarantee agreement may authorize the administrator to pay, subject to any terms and conditions set out in the advance guarantee agreement, a portion of an advance as an emergency advance to an eligible producer who

  • (a) has difficulty producing the producer’s agricultural product because of unusual production conditions that are attributable to weather or natural disaster, if it is reasonable to expect that the agricultural product will be marketable; or

  • (b) experiences severe economic hardship, if the Governor in Council, on the recommendation of the Minister and the Minister of Finance, has declared — taking into account any criteria prescribed by regulation — that severe economic hardship affects a class of eligible producers to which that producer belongs and that the severe economic hardship would likely be substantially mitigated by emergency advances.

• Marginal note:Time limit for payment

  (2) When acting under paragraph (1)(b), the Governor in Council must specify the time limit — not later than the day on which the production period ends — within which the emergency advances under that paragraph must be paid.

• Marginal note:Maximum amount

  (3) The maximum amount of the emergency advance is

  • (a) in the case of an emergency advance under paragraph (1)(a), the lesser of $25,000, or the amount fixed by regulation, and 50%, or the percentage fixed by regulation, of the advance that the administrator expects to make to the producer in respect of the agricultural product on the basis of the amount of that product that is expected to be produced; or

  • (b) in the case of an emergency advance under paragraph (1)(b), the lesser of $400,000, or the amount fixed by regulation, and 100%, or the percentage fixed by regulation, of the advance referred to in paragraph (a).

• Marginal note:Provisions do not apply

  (4) Paragraph 5(3)(e) does not apply to emergency advances under paragraph (1)(a) and, unless the advance guarantee agreement specifies otherwise, the following provisions do not apply to emergency advances under paragraph (1)(b):

  • (a) paragraphs 5(3)(e) and (g);

  • (b) subsection 5(3.01);

  • (c) paragraphs 10(1)(g) and (h);

  • (d) paragraphs 10(2)(b) to (c); and

  • (e) subsection 19(3).

• Marginal note:Applicable Minister’s percentage

  (5) Unless paragraph 5(3)(g) applies under the advance guarantee agreement to emergency advances under paragraph (1)(b), the Minister’s percentage mentioned in paragraph 5(3)(i) and subsection 23(1) is 100% for an emergency advance under paragraph (1)(b) and shall not be determined by regulation.

• Marginal note:Security

  (6) The advance guarantee agreement may specify, in the place of or in addition to the security required by regulations made for the purpose of section 12, the security that the administrator is required to take for an emergency advance under paragraph (1)(b).

8 [Repealed, 1999, c. 26, s. 44]

Marginal note:Payment of interest

• 9 (1) The Minister must, in relation to each producer, pay to the lender specified in the advance guarantee agreement — or, if the agreement was made only with an administrator, to the administrator — the interest accruing during a production period on the amounts borrowed by the administrator to pay the first $100,000 — or the amount fixed by regulation — of the total of the following amounts advanced during the production period, or during any shorter period specified in the agreement:

  • (a) amounts advanced to the producer for all of their agricultural products, and

  • (b) the percentage of the amounts advanced to all related producers, for all of their agricultural products, that is attributable to the producer under subsection (2).

• Marginal note:Attribution

  (2) The amounts advanced to related producers are attributable to the producer as follows:

  • (a) if the related producer is an individual, the attributable percentage is 100%;

  • (b) if the related producer is a corporation, the attributable percentage is the percentage of the voting shares that the producer holds in the related producer;

  • (c) if the related producer is a cooperative, the attributable percentage is the percentage prescribed by the regulations; and

  • (d) if the producer and the related producer are partners or members of the same partnership or other association of persons, the attributable percentage is the percentage of the profits of the partnership or association to which the producer is entitled.

• Marginal note:Interest on emergency advances

  (3) The Minister is not required to pay the interest for an emergency advance, unless the advance guarantee agreement provides for its payment.

• Marginal note:Reduction of principal

  (4) When an amount is repaid on account of a guaranteed advance, the amount on which the Minister must pay interest is reduced by the amount of the repayment.

Eligibility and Repayment

Marginal note:Eligibility requirements for producers

• 10 (1) For a producer to be eligible for a guaranteed advance during a production period,

  • (a) the producer must own the agricultural product continuously and be responsible for marketing it, as determined by the Minister, taking into account any criteria prescribed by regulation;

  • (b) if the producer is an individual, the producer must have attained the age of majority in the province where the producer’s farming operation is carried on and must be principally occupied in that operation or be entitled to the agricultural product or a share in it as lessor, vendor, mortgagee or hypothecary creditor;

  • (c) if the producer is a corporation with only one shareholder, the shareholder must

    • (i) have attained the age of majority in the province where the producer’s farming operation is carried on,

    • (ii) be principally occupied in that operation or be entitled to the agricultural product or a share in it as lessor, vendor, mortgagee or hypothecary creditor, and

    • (iii) agree in writing to be personally liable to the administrator for any liability of the producer under section 22 and to provide any security for the repayment of the advance that the administrator may require;

  • (d) if the producer is a corporation with two or more shareholders, a partnership, a cooperative or another association of persons,

    • (i) at least one of the shareholders, partners or members, as the case may be, must have attained the age of majority in the province where the producer’s farming operation is carried on and must be principally occupied in that operation or be entitled to the agricultural product or a share in it as lessor, vendor, mortgagee or hypothecary creditor, and

    • (ii) each of the shareholders, partners or members, as the case may be, must agree in writing to be jointly and severally, or solidarily, liable to the administrator for any liability of the producer under section 22 and must provide any security for the repayment of the advance that the administrator may require;

  • (e) the producer and, to the extent provided in the advance guarantee agreement, any related producers must not be in default under a repayment agreement;

  • (f) the producer must not be ineligible under subsection 21(4);

  • (f.1) the producer must demonstrate to the administrator that the producer is capable of meeting its obligations under the repayment agreement;

  • (g) the producer must not have given the agricultural product, or any amount to be received under a program listed in the schedule, as security ranking in priority to the security created by section 12;

  • (h) the producer must demonstrate that

    • (i) in the case of an agricultural product that is storable, it is of marketable quality and stored so as to remain of marketable quality until disposed of or, if that agricultural product is in the course of being produced, or is not yet produced, the amount of the advance is covered by a program listed in the schedule and amounts that may be received under that program are assignable,

    • (ii) in the case of an agricultural product that is not storable, it is of marketable quality and maintained so as to remain of marketable quality until disposed of, the amount of the advance is covered by a program listed in the schedule and amounts that may be received under that program are assignable or, if that agricultural product is in the course of being produced, or is not yet produced, the amount of the advance is covered by a program listed in the schedule and amounts that may be received under that program are assignable, 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; and

  • (i) the producer must meet any additional requirements prescribed by regulation.

• Marginal note:Sharing security

  (1.1) For the purpose of paragraph (1)(h), the producer’s eligibility is not affected by the administrator sharing its security with another creditor in accordance with the terms and conditions specified in the advance guarantee agreement.

• Marginal note:Eligible producers must make repayment agreements

  (2) An eligible producer must make a repayment agreement with the administrator under which the producer agrees

  • (a) to repay the advance

    • (i) by selling the agricultural product for which the advance is to be made to a buyer or buyers named by the administrator, and authorizing in writing each buyer to withhold from any amount they pay to the producer for each production unit an amount determined in accordance with the repayment schedule specified in the agreement,

    • (ii) by selling, in accordance with the terms and conditions specified in the agreement, the agricultural product for which the advance is to be made and paying directly to the administrator, for each production unit, an amount determined in accordance with the repayment schedule specified in the agreement,

    • (iii) by paying directly to the administrator any amount received under a program listed in the schedule in accordance with the terms and conditions specified in the agreement,

    • (iv) by assigning to the administrator amounts payable to the producer under a program listed in the schedule in accordance with the terms and conditions specified in the agreement,

    • (v) without proof that the agricultural product has been sold, by paying the administrator an amount up to an amount prescribed by the regulations, or

    • (vi) by paying the administrator by a combination of the methods described in subparagraphs (i) to (v);

  • (b) to ensure that

    • (i) in the case of an agricultural product that is storable, it will be stored so as to remain of marketable quality until disposed of in accordance with the repayment agreement or, if that agricultural product is in the course of being produced, or is not yet produced, the amount of the advance is covered by a program listed in the schedule and amounts that may be received under that program are assignable,

    • (ii) in the case of an agricultural product that is not storable, it will be maintained so as to remain of marketable quality until disposed of in accordance with the repayment agreement, the amount of the advance is covered by a program listed in the schedule and amounts that may be received under that program are assignable or, if that agricultural product is in the course of being produced, or is not yet produced, the amount of the advance is covered by a program listed in the schedule and amounts that may be received under that program are assignable, and

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

  • (b.1) if required by the advance guarantee agreement, to inform the administrator of the producer’s participation in any program listed in the schedule;

  • (b.2) if required by the advance guarantee agreement, to assign, if the producer is 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;

  • (c) to repay the amount of the overpayment, if any, of the advance within the period that begins on the earlier of the day on which the producer becomes aware of the overpayment and the day on which the administrator mails or delivers a notice to the producer stating that there has been an overpayment of the advance and ends on the expiry of the number of days set out in the agreement; and

  • (d) to comply with any other terms and conditions set out in the agreement, including terms and conditions governing the delivery of the agricultural product and the payment of interest, both before and after any default.

• Marginal note:Terms and conditions governing emergency advances

  (3) Terms and conditions in the advance guarantee agreement relating to emergency advances must also be included in the repayment agreements of producers who receive those advances.

• Marginal note:Required information

  (4) The producer must provide to the administrator any information that it requests for the purpose of applying this Act.

Marginal note:Unmarketable agricultural product

11 If an agricultural product for which a guaranteed advance is made ceases to be in marketable condition, in whole or in part, through no fault of the producer, the producer becomes liable to repay immediately, to the administrator that made the advance, the portion of the guaranteed advance that is attributable to the unmarketable portion of the agricultural product, together with the interest on that portion from the date of the advance.

Marginal note:Security

12 An administrator that makes a guaranteed advance to a producer in a production period in respect of an agricultural product shall take the security required by the regulations, for the amount of the producer’s liability under sections 22 and 23, in the agricultural product for which the advance was made, in any agricultural product produced in a subsequent production period by the producer and, subject to the repayment agreement, in any amount that may be received by the producer under a program listed in the schedule.

Canadian Wheat Board

Marginal note:Powers to make arrangements and agreements

• 13 (1) For the purpose of making guaranteed advances under this Act, the Board may make any arrangements, contracts or agreements that it considers necessary or advisable for the administration of this Part and it may borrow or raise money by any means, including by issuing, reissuing, selling and pledging bonds, debentures, notes and other evidences of indebtedness of the Board.

• Marginal note:Minister of Finance to guarantee repayment

  (2) The Minister of Finance may, subject to any terms and conditions approved by the Governor in Council, guarantee the repayment of money borrowed under subsection (1) together with the interest on it if the money is borrowed or raised in order to make an advance under a guaranteed advance agreement to which the only parties are the Minister and the Board.

Marginal note:Cash purchase tickets

14 Despite the Canada Grain Act, every person, including the manager or operator of an elevator, authorized by the Board to make guaranteed advances on its behalf may make advances by means of cash purchase tickets.

15 [Repealed, 2006, c. 3, s. 10]

Marginal note:Delivery of documents

• 16 (1) At any time after a producer applies to the Board for an advance, the Board may require the producer to deliver to it any document, including a permit book, that the Board issued to the producer or to a related producer.

• Marginal note:Endorsement

  (2) The Board may require an endorsement to be made in any of those documents, in a form specified by the Board, indicating that amounts must be deducted in accordance with the repayment agreement with the producer and paid to the Board in priority to all other persons.

Marginal note:Deductions

• 17 (1) If an agricultural product for which the Board has required the delivery of a document bearing an endorsement required under subsection 16(2) is sold, the producer of the agricultural product or, if the person purchasing it has been authorized by the Board to make remittances to the Board in respect of amounts paid for agricultural products, the person purchasing the agricultural product, shall

  • (a) deduct and pay to the Board, in priority to all other persons, the portion of the payment for the agricultural product that the repayment agreement with the producer authorizes to be deducted from each payment until the advance has been repaid; and

  • (b) make an appropriate entry of the deduction in the document and in any other document that has the same endorsement and that is presented to the person purchasing the agricultural product.

• Marginal note:Cancellation of endorsement

  (2) When the guaranteed advance has been repaid, the Board must cancel the endorsement.

Marginal note:Prohibition

18 A producer whose document has been endorsed under subsection 16(2) is not entitled to receive and shall not use any other document, including a document of a related producer, in substitution for the endorsed document for the same or any subsequent production period, unless the guaranteed advance is repaid or the endorsement is also made in the other document.

Amount of Advances

Marginal note:Amount of advance to be guaranteed

• 19 (1) Subject to subsection (3), the amount of an advance eligible for a guarantee under this Part is calculated by multiplying

  • (a) the number of production units for which the advance is to be made

  by

  • (b) the rate per production unit specified in the advance guarantee agreement for the agricultural product for the production period for which the advance is made, or for a specified portion of the production period for which the advance is made.

• Marginal note:Rate per production unit

  (2) The rate per production unit may be specified for a particular agricultural product in a particular area, but it must not exceed 50%, or the percentage fixed by regulation, of the average price that in the Minister’s opinion will be payable to producers of the agricultural product in that area.

• Marginal note:Exception

  (3) If, because of paragraph 10(1)(h), the amount of the advance must be covered by a program listed in the schedule, the maximum amount of an advance eligible for a guarantee under this Part is the lesser of the amount calculated under subsection (1) and the percent-age, specified in the advance guarantee agreement, of the maximum amount that the producer could receive under that program.

Marginal note:Annual maximum guarantee for each producer

• 20 (1) Subject to subsection (1.1), the maximum amount of advances in any production period that are eligible for a guarantee under this Act is

  • (a) for a particular agricultural product produced by a producer, the amount specified in the advance guarantee agreement for that agricultural product; and

  • (b) for all agricultural products produced by a producer or a related producer, to the extent that advances for the agricultural products are attributable to the producer under subsection (2), $400,000 or the amount fixed by regulation.

• Marginal note:Overlapping production periods

  (1.1) The maximum amount of all advances that are eligible for a guarantee under this Act in relation to a producer, or to a related producer to the extent that the advances are attributable to the producer under subsection (2), may not, at any one time, exceed $400,000, or the amount fixed by regulation.

• Marginal note:Attribution

  (2) Amounts advanced to related producers are attributable to the producer as follows:

  • (a) if the related producer is an individual, the attributable percentage is 100%;

  • (b) if the related producer is a corporation, the attributable percentage is the percentage of the voting shares that the producer holds in the related producer;

  • (c) if the related producer is a cooperative, the attributable percentage is the percentage prescribed by the regulations; and

  • (d) if the producer and the related producer are partners or members of the same partnership or other association of persons, the attributable percentage is the percentage of the profits of the partnership or association to which the producer is entitled.

Default

Marginal note:Circumstances constituting default

• 21 (1) For the purposes of this Part, a producer is in default under a repayment agreement if the producer

  • (a) has not met any of their obligations under the agreement within 20 days after the day on which the administrator mails or delivers a notice to the producer stating that the producer has had, in the opinion of the administrator, adequate opportunity to meet the obligation, and requesting the producer to meet it;

  • (b) has not met all of their obligations under the agreement at the end of the production period for which the advance was made;

  • (c) has not met all of their obligations under the agreement when the producer files an assignment under the Bankruptcy and Insolvency Act or a bankruptcy order is made under that Act against the producer;

  • (d) at any time breaches an obligation under the agreement and, if the breach relates to the obligation to store the agricultural product or to maintain it so that it remains of marketable quality, section 11 does not apply; or

  • (e) provides false or misleading information to the administrator for the purpose of obtaining a guaranteed advance, or evading compliance with an undertaking to repay it.

• Marginal note:Stay of default

  (2) If a default is impending, the Minister may, at the request of the administrator, order the default to be stayed for a specified period on any terms that the Minister may establish.

• Marginal note:When default ceases

  (3) A producer ceases to be in default on the full discharge of the producer’s liability under sections 22 and 23.

• Marginal note:Ineligibility period

  (4) An advance guarantee agreement may provide that a producer continues to be ineligible for a guaranteed advance for any period specified in the agreement, even though the producer has ceased to be in default.

Marginal note:Liability of defaulting producer to administrator

22 A producer who is in default under a repayment agreement is liable to the administrator for

• (a) the outstanding amount of the guaranteed advance;

• (b) the interest at the rate specified in the repayment agreement on the outstanding amount of the advance, calculated from the date of the advance; and

• (c) costs incurred by the administrator to recover the outstanding amount and interest, including legal costs approved by the Minister.

Marginal note:Payments to be made by Minister

• 23 (1) If a producer is in default under a repayment agreement and the Minister receives a request for payment from the administrator or lender to whom the guarantee is made, the Minister must, subject to any regulations made under paragraphs 40(1)(g) and (g.1), pay to the lender or the administrator, as specified in the advance guarantee agreement, an amount equal to the Minister’s percentage of

  • (a) the amounts mentioned in paragraphs 22(a) and (c); and

  • (b) the interest at the rate specified in the advance guarantee agreement on the outstanding amount of the advance, calculated from the date of the advance.

• Marginal note:Subrogation

  (2) The Minister is, to the extent of any payment under subsection (1), subrogated to the administrator’s rights against the producer in default and against persons who are personally liable under paragraphs 10(1)(c) and (d).

• Marginal note:Recovery of interest and costs

  (3) The producer is liable to the Minister for interest on the subrogated amount, calculated in accordance with the repayment agreement, and the costs incurred by the Minister to recover that amount, including legal costs.

• Marginal note:Limitation period

  (4) No action or proceedings may be initiated by the Minister to recover any amounts, interest and costs that are owing more than six years after the day on which the Minister is subrogated to the administrator’s rights.

• Marginal note:Deduction and set-off

  (5) The amounts, interest and costs that are owing may be recovered at any time by way of deduction from or set-off against any sum of money that may be due or payable by Her Majesty in right of Canada to the person who is liable or their estate or succession.

Marginal note:Board deductions

• 24 (1) If a producer is in default under a repayment agreement with the Board or any other administrator, the Board may, for the purpose of repaying the producer’s liability under sections 22 and 23, make deductions from any amounts owing under the Canadian Wheat Board Act to the producer or to another producer whose permit book the producer uses.

• Marginal note:Liability extinguished

  (2) On making the deduction, the Board’s liability to the producer is extinguished to the extent of the deduction.

Marginal note:Payments out of the C.R.F.

25 Payments that the Minister or the Minister of Finance is liable to make under this Part are to be made out of the Consolidated Revenue Fund.

PART IIPrice Pooling Program

Marginal note:Purpose

26 The purpose of this Part is to facilitate the marketing of agricultural products under cooperative plans by guaranteeing minimum average prices of products sold by marketing agencies.

Marginal note:Conditions for price guarantee agreements

27 The Minister may, with the approval of the Minister of Finance, establish conditions under which price guarantee agreements may be made.

Marginal note:Minister may make agreements

• 28 (1) Once the Minister has established the conditions, the Minister may make a price guarantee agreement with a marketing agency.

• Marginal note:Contents of agreement

  (2) The price guarantee agreement must provide that

  • (a) the Minister is to pay amounts based on the difference obtained by subtracting

    • (i) the average wholesale price of an agricultural product

    from

    • (ii) the initial payment made by the marketing agency for the agricultural product, together with the marketing agency’s costs;

  • (b) the initial payment and the marketing agency’s costs applicable to the agricultural product are those relating to the volume, grade, type and variety of the product at the time of sale;

  • (c) the average wholesale price is to be a reasonable price, as determined at the time of sale and, in case of a dispute, the Minister determines the price;

  • (d) the initial payment, the marketing agency’s costs and the average wholesale price are to be determined in the manner specified in the agreement, including specified maximum amounts; and

  • (e) the marketing agency is to comply with this Part and any other terms and conditions specified in the agreement.

• Marginal note:Requirements for marketing agency

  (3) The cooperative plan administered by the marketing agency must apply to

  • (a) a significant portion of the producers in the area where the plan applies; or

  • (b) a significant portion of the agricultural product produced in that area.

  In addition, the Minister must be satisfied that marketing the product under the cooperative plan will benefit the producers.

• Marginal note:Cooperative plan

  (4) The cooperative plan must be an agreement or arrangement for marketing that provides for

  • (a) an initial payment to producers for delivery, in accordance with the agreement or arrangement, of an agricultural product produced in Canada;

  • (b) pooling the proceeds of the sale of the agricultural product;

  • (c) equal returns to the producers for like grades, varieties and types of the agricultural product; and

  • (d) returning to the producers the proceeds of the sale of all of the agricultural product delivered under the agreement or arrangement and produced during a period of 12 months or less specified in the agreement or arrangement, after deducting the marketing agency’s costs and any reserves.

Marginal note:Production and delivery of product

• 29 (1) The agricultural product must be

  • (a) produced by the producer who received the initial payment during the period specified under paragraph 28(4)(d); and

  • (b) delivered during that period to the marketing agency under a single cooperative plan.

• Marginal note:Discontinuing delivery

  (2) During the period specified under paragraph 28(4)(d), the Minister may give notice to the marketing agency that the price guarantee agreement will not apply to any quantity of the agricultural product delivered after the date specified in the notice.

Marginal note:Payment of liabilities under agreement

30 The Minister of Finance may, with the approval of the Governor in Council, pay out of the Consolidated Revenue Fund any amount that the Minister of Agriculture and Agri-Food becomes liable to pay under a price guarantee agreement.

PART IIIGovernment Purchases Program

Marginal note:Powers of Minister

• 31 (1) The Minister may, with the authorization of the Governor in Council,

  • (a) sell or deliver agricultural products to a government or government agency of any country under an agreement made by Her Majesty with the government or government agency, and for that purpose may purchase agricultural products and make any arrangements for their purchase, sale or delivery that the Minister considers necessary or desirable;

  • (b) purchase, or negotiate contracts for the purchase of, agricultural products on behalf of a government or government agency of any country;

  • (c) buy, sell or import agricultural products;

  • (d) require any person on reasonable notice to give, at a specified time, any information about agricultural products that may be necessary for the administration of this Part; and

  • (e) store, transport or process agricultural products, or make contracts for their storage, transportation or processing.

• Marginal note:Limitation

  (2) Except with the approval of the Governor in Council, the Minister may not sell an agricultural product under paragraph (1)(a) or (c) at a price lower than the purchase price plus handling, storage and transportation costs.

PART IVGeneral Provisions

Contractual and Financial Matters

Marginal note:Cost recovery regulations

32 For the purpose of recovering costs incurred by the Minister under this Act, the Minister may make regulations for charging fees related to making advance guarantee agreements and price guarantee agreements and fees for any other services provided by the Minister under this Act.

Marginal note:Expenditures of the Board

33 All expenditures made by the Board in the administration of this Act, other than those reimbursed to the Board by the Minister under section 23, are deemed to be expenses of the Board for the purposes of section 33 of the Canadian Wheat Board Act.

Marginal note:Crown debts assignable

33.1 The following may be assigned in whole or in part:

• (a) for the purposes of Part I, an amount payable under a program listed in the schedule that is a Crown debt within the meaning of section 66 of the Financial Administration Act; and

• (b) for the purposes of Part II, an amount payable by the Minister under a price guarantee agreement.

Offences and Punishment

Marginal note:Information relating to advance guarantees

• 34 (1) An administrator commits an offence if, for the purpose of obtaining a guarantee from the Minister under Part I or evading compliance with any obligation relating to the guarantee, the administrator

  • (a) gives false or misleading information to the Minister; or

  • (b) fails to disclose any relevant information to the Minister.

• Marginal note:Information relating to guaranteed advances

  (2) A person commits an offence if, for the purpose of obtaining a guaranteed advance under Part I, or evading, or helping someone evade, compliance with an undertaking to repay it, the person

  • (a) gives false or misleading information to an administrator or to the Minister; or

  • (b) fails to disclose any relevant information to an administrator or to the Minister.

• Marginal note:Deductions and entries in permit books

  (3) A person who contravenes section 17 commits an offence.

• Marginal note:Use of document

  (4) A person who uses a document in contravention of section 18 commits an offence.

Marginal note:Information relating to price guarantee agreements

• 35 (1) A marketing agency commits an offence if, for the purpose of negotiating a price guarantee agreement, or obtaining a payment or evading compliance with any obligation under the agreement, the marketing agency

  • (a) gives false or misleading information to the Minister; or

  • (b) fails to disclose any relevant information to the Minister.

• Marginal note:Information relating to payments

  (2) A person commits an offence if, for the purpose of obtaining a payment under Part II, the person

  • (a) gives false or misleading information to a marketing agency or to the Minister; or

  • (b) fails to disclose any relevant information to a marketing agency or to the Minister.

Marginal note:Non-compliance with information requirements

• 36 (1) A person who does not comply with a requirement to provide information under paragraph 31(1)(d) commits an offence.

• Marginal note:Evidence of requirements

  (2) In a prosecution under subsection (1), evidence of a requirement may be given by the production of a copy of the requirement appearing to be certified as a copy by the Minister or another official of the Department of Agriculture and Agri-Food.

Marginal note:Punishment

37 A producer, administrator, marketing agency or other person who commits an offence under this Act is

• (a) if the offence is committed wilfully, liable on proceedings by way of indictment to a fine of not more than $500,000, to imprisonment for a term of not more than five years, or to both; and

• (b) in any other case, liable on summary conviction to a fine of not more that $10,000, to imprisonment for a term of not more than six months, or to both.

Marginal note:Prosecution of partnership

• 38 (1) A prosecution under this Act against a partnership may be brought in the name of the partnership and, for the purpose of the prosecution, the partnership is deemed to be a person. Anything done or omitted by a partner or agent of the partnership within the scope of their authority to act on behalf of the partnership is deemed to have been done or omitted by the partnership.

• Marginal note:Officers, etc., of corporations or partnerships

  (2) If a corporation or partnership commits an offence under this Act, whether or not it has been prosecuted or convicted, any officer, director, partner or agent of the corporation or partnership who directed, authorized, assented to, acquiesced in or participated in the commission of the offence is a party to and guilty of the offence and is liable to the punishment provided for the offence.

Marginal note:Limitation period

39 A prosecution under this Act may be instituted no later than five years after the act or omission giving rise to the prosecution occurred.

Regulations

Marginal note:Governor in Council regulations

• 40 (1) The Governor in Council may make regulations

  • (a) for the purposes of the definition administrator in subsection 2(1), prescribing criteria for determining

    • (i) whether organizations represent producers in an area, or

    • (ii) what constitutes a significant portion of an agricultural product, either generally or with respect to any specified area;

  • (a.1) designating animals as livestock for the purposes of the definition livestock in subsection 2(1);

  • (b) for the purpose of subsection 4.1(1), prescribing criteria for

    • (i) establishing an average price for an agricultural product, or

    • (ii) determining whether an agricultural product is not processed or not processed beyond what is necessary to store it and prevent spoilage;

  • (c) determining the administrator’s percentage mentioned in paragraph 5(3)(g), or establishing a method of calculating it, which percentage may differ among administrators depending on their experience and past performance;

  • (d) determining a method of calculating the Minister’s percentage mentioned in paragraph 5(3)(i) and subsection 23(1);

  • (d.1) fixing an amount for the purposes of each of subsection 5(5), paragraphs 7(3)(a) and (b), subsection 9(1), paragraph 20(1)(b) and subsection 20(1.1), which amount may, for the purposes of subsection 9(1), paragraph 20(1)(b) or subsection 20(1.1), differ with regard to classes of producers;

  • (d.2) prescribing criteria for the purposes of paragraph 7(1)(b);

  • (e) fixing a percentage for the purposes of each of paragraphs 7(3)(a) and (b) and 9(2)(c), subsection 19(2) and paragraph 20(2)(c);

  • (e.1) prescribing criteria for determining, for the purpose of paragraph 10(1)(a), when a producer ceases to own an agricultural product or ceases to be responsible for its marketing;

  • (e.2) prescribing, for the purposes of paragraph 10(1)(i), additional requirements, including requirements based on different classes of producers or agricultural products, different amounts of potential producer liability and different risks associated with that liability;

  • (f) prescribing an amount for the purposes of subparagraph 10(2)(a)(v);

  • (f.1) for the purposes of paragraph 10(2)(c), defining overpayment;

  • (f.2) respecting the security that administrators are required to take for the purposes of section 12;

  • (g) respecting the attempts to be made by an administrator to collect on a producer’s liability under section 22 before and after the administrator requests payment from the Minister under subsection 23(1);

  • (g.1) respecting the terms and conditions that must be met before a request for payment referred to in subsection 23(1) is made by a lender;

  • (h) for determining for the purposes of subsection 28(3) what is a significant portion of producers or agricultural product;

  • (h.1) respecting the assignment of the amounts referred to in paragraphs 33.1(a) and (b); and

  • (i) generally, for carrying out the purposes and provisions of this Act.

• Marginal note:Recommendation

  (2) Regulations made under paragraph (1)(d.1), and regulations made under paragraph (1)(e) to the extent that they fix a percentage for the purposes of paragraph 7(3)(a) or (b) or subsection 19(2), may be made only on the recommendation of the Minister with the concurrence of the Minister of Finance.

• Marginal note:Different requirements for security

  (3) Regulations made under paragraph (1)(f.2) may require different security to be taken with respect to different classes of agricultural products, different amounts of producer liability and different risks associated with that liability.

Reports to Parliament

Marginal note:Annual report

41 At the end of each fiscal year, the Minister must prepare a report on the administration of this Act, including the agreements made under it, and must have the report laid before each House of Parliament on any of the first 15 days on which it is sitting after the report is completed.

Marginal note:Five-year review

• *42 (1) Every five years after the coming into force of this subsection, the Minister must review the provisions and operation of this Act in consultation with the Minister of Finance.

  • Return to footnote ^*[Note: Subsection 42(1) in force on November 27, 2006, see SI/2006-136.]

• Marginal note:Emergency advances

  (1.1) The Ministers’ review of the provisions of this Act relating to emergency advances under paragraph 7(1)(b) and their application must specifically address whether those provisions are necessary and to what extent they should be retained or modified.

• Marginal note:Tabling of report

  (2) The Minister must have a report on the review laid before each House of Parliament on any of the first 30 days on which it is sitting after the report is completed.

PART VRepeals, Transitional Provisions, Consequential Amendments and Coming into Force

Repeals

43 to 46 [Repeals]

Transitional Provisions

Agricultural Products Board Act

Definition of Board

47 In sections 48 and 49, Board means the Agricultural Products Board, established under subsection 3(1) of the Agricultural Products Board Act.

Marginal note:Rights and obligations transferred

• 48 (1) All rights and property held by or in the name of or in trust for the Board and all obligations and liabilities of the Board are deemed to be rights, property, obligations and liabilities of Her Majesty.

• Marginal note:References

  (2) Every reference to the Board in any deed, contract or other document executed by the Board in its own name is to be read as a reference to Her Majesty, unless the context requires otherwise.

• Marginal note:Closing out affairs

  (3) The Minister may do anything necessary for or incidental to closing out the affairs of the Board.

Marginal note:Legal proceedings against Her Majesty

• 49 (1) Any action, suit or other legal proceeding in respect of any obligation or liability incurred by the Board, or by the Minister in closing out the affairs of the Board, may be brought against Her Majesty in any court that would have had jurisdiction if the action, suit or proceeding had been brought against the Board.

• Marginal note:Legal proceedings by Her Majesty

  (2) Any action, suit or other legal proceeding in respect of any right of the Board, or any right acquired by the Minister in closing out the affairs of the Board, may be brought by Her Majesty in any court that would have had jurisdiction if the action, suit or proceeding had been brought by the Board.

• Marginal note:Continuation of legal proceedings

  Footnote ^*(3) Any action, suit or other legal proceeding to which the Board is party pending in any court on the coming into force of this section may be continued by or against Her Majesty in the like manner and to the same extent as it could have been continued by or against the Board.

  • Return to footnote ^*[Note: Section 49 in force January 1, 1997, see subsection 56(1).]

Agricultural Products Cooperative Marketing Act

Marginal note:No agreements after December 31, 1996

50 No agreements may be made under section 3 of the Agricultural Products Cooperative Marketing Act after December 31, 1996.

Advance Payments for Crops Act

Marginal note:No guarantees of advances after March 31, 1997

51 The Minister may not guarantee under section 4 of the Advance Payments for Crops Act any advances made after March 31, 1997 or any interest attributable to those advances.

Marginal note:Defaults

51.1 For the purpose of applying paragraph 10(1)(e), a default under a repayment agreement includes a default in repaying an advance made under the Advance Payments for Crops Act on or before March 31, 1997.

Prairie Grain Advance Payments Act

Marginal note:No advances after May 31, 1997

• 52 (1) The Board may not make any advances under section 3 of the Prairie Grain Advance Payments Act after May 31, 1997.

• Marginal note:Subrogation

  (2) The Minister is, to the extent of any payment under section 19 of the Prairie Grain Advance Payments Act, subrogated to the Board’s rights against the producer in default and against persons who are personally liable for any amount in default.

Marginal note:Defaults

52.1 For the purpose of applying paragraph 10(1)(e), a default under a repayment agreement includes a default in repaying an advance payment made under the Prairie Grain Advance Payments Act on or before May 31, 1997.

Consequential Amendments

53 to 55 [Amendments]

Coming into Force

Marginal note:Coming into force — general

• 56 (1) This Act, except sections 44 to 46, comes into force on January 1, 1997.

• Marginal note:Coming into force — sections 44 to 46

  Footnote ^*(2) Sections 44 to 46 come into force on a day or days to be fixed by order of the Governor in Council.

  • Return to footnote ^*[Note: Sections 44 to 46 not in force.]