Model Agreement For Responsible Contract Farming

The guide goes through the conceptual phases of contract farming. It provides an in-depth analysis of material law issues relating to agricultural production contracts. It identifies problematic areas and possible solutions in light of the use of trade and legislation. Book Content: Introduction, 1 – The Legal Framework of Agricultural Production Contracts, II – Contracting Parties to Contract, Creation and Form, III – Parties` Obligations, IV – Apologies for Non-Compliance, V – Remedy for Violations, VI – Contract Duration, Extension and Termination, VII – Dispute Settlement Determines whether the production agreement with the manufacturer is exclusive or not exclusive to avoid sales or breaches. The contract should indicate when and where the goods should be delivered, as well as the mode and currency to be used for payment. The testing procedure for the required products must be clearly described so that manufacturers are not vulnerable to arbitrary buyer decisions when reviewing and classifying goods. Ideally, the manufacturer should be present or represented at the inspection and an independent third party (approved by both parties) should also be involved in the inspection process. With the growth of global supply chains and the evolution of food systems, the quality and clarity of contracts are increasingly important, not only to ensure the efficiency of agricultural value chains, but also to respect the rights of the buyers and producers concerned. If negotiations and agreements between the parties are duly facilitated, contract farming (often made to gain exclusive access to products) can bring benefits to both producers and buyers – producers can increase their incomes by gaining stable access to more remote and profitable markets and access to improved inputs and technologies; On the other hand, buyers benefit from their ability to ensure a stable supply of quality agricultural products in the required quantities. Buyers are also able to purchase products that are grown and processed according to specific production methods and standards. The guide aims to serve as a reference for “good practice” by providing guidance to parties operating in contracted companies for the duration of the contract, from negotiation to termination, thereby helping to build trust between the parties and support mutually beneficial relationships.

The guide can also be used as a reference in the formulation of public administration instruments for the maintenance of agricultural development. Given its various potential applications, the guide will provide an additional tool for international organizations and bilateral cooperation organizations, as well as non-governmental organizations, to develop strategies and programs for contracted agriculture assistance in developing countries. These include soil preparation, harvesting, handling or all the processes/entries involved in production. Where possible, the contract should refer to an attached document as a reference and have a provision detailing the right of the purchaser or an authorized third party to verify, track and certify compliance. The contract should also clearly distribute responsibilities among the parties with respect to the supply and use of inputs, whether they are material inputs such as fertilizers and seeds or intangible inputs such as technical assistance and training. While this guide contains examples and general recommendations, it is recommended that parties to contractual agreements also refer to existing global principles and guidelines for contract agriculture, including the World Food Security Committee`s (CSNC) Voluntary Guidelines for Responsible Land, Forest and Fisheries Management (VGGT), the CFS Principles for Responsible Investment in Agriculture and Food Systems (CFS-RAI) and OECD guidelines for the proper management of agricultural supply chains.