An Act to amend the Agricultural Marketing Programs Act (S.C. 2006, c. 3)
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Assented to 2006-06-22
Marginal note:1999, c. 26, s. 43
4. Sections 6 and 7 of the Act are replaced by the following:
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) and, unless the agreement specifies otherwise, section 23 do not apply in respect of an advance guarantee agreement that the Minister enters into without making the guarantee referred to in paragraph 5(1)(a).
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) Despite paragraph 5(3)(e), 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 has difficulty producing the producer’s agricultural product because of unusual production conditions attributable to weather or natural disaster if it is reasonable to expect that the agricultural product will be marketable.
Marginal note:Maximum amount
(2) The maximum amount of the emergency advance is 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.
5. Subsection 9(1) of the Act is replaced by the following:
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).
6. (1) Subsection 10(1) of the Act is replaced by the following:
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);
(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; and
(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, and
(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.
Marginal note:1999, c. 26, s. 45
(2) Subsection 10(1.1) of the English version of the Act is replaced by the following:
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.
(3) Subsection 10(2) of the Act is replaced by the following:
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,
(iv) by assigning to the administrator amounts payable to the producer under a program listed in the schedule,
(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, and
(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;
(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.
7. Sections 11 and 12 of the Act are replaced by the following:
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.
8. (1) Subsection 13(1) of the English version of the Act is replaced by the following:
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.
(2) Subsection 13(2) of the Act is replaced by the following:
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.
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