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The
Ontario Beef Cattle Financial Protection Program
(OBCFPP) was established through provincial legislation
and regulation in 1982 to provide protection to cattle
sellers against default in payment when cattle are sold
to a licenced dealer. The program is administered by the
Ontario Ministry of Agriculture, Food and Rural Affairs.
The program was set up at the request of the Ontario
Cattlemen's Association (OCA) and the Ontario Livestock
Auction market Association (OLAMA).
The program
consists of the licensing of livestock abattoirs,
associations, auction markets, country dealers and
packing plants. A fund is established from a compulsory
5 cent per head deduction when cattle are sold. A claim
can be made against the fund if an eligible cattle
seller has suffered a default in payment. Claims are
adjudicated by an industry board appointed by the
Minister according to a set of program criteria.
Any
producer who sells cattle to an unlicensed livestock
abattoir, auction market, country dealer, or packing
plant is not covered under the program, therefore
it is important to sell cattle to a licensed livestock
abattoir, auction market, country dealer, or packing
plant.
If
a seller is in any doubt whatsoever regarding the
CURRENT status of a prospective purchaser, he/she should
telephone Jim Wideman at the Ontario
Ministry of Agriculture, Food and Rural Affairs
directly.
Our Address
Is:
Ontario
Ministry of Agriculture, Food and Rural Affairs
Food Inspection Branch
Ontario Beef Cattle Financial Protection Program
1 Stone Road West, 5th North West
Guelph, ON
N1G 4Y2
Contact:
Jim Wideman
Ontario Beef Cattle Financial Protection Program
1-888-466-2372 or 1-888-4-OMAFRA Extension: 6-3886
Direct: (519) 826-3886
Fax: (519) 826-4375
Email:
Jim.wideman@ontario.ca
Monday to Friday, 8:30am to 5:00pm
Calls outside these hours are recorded and
all emergency calls are responded to.
RULES OF
THE PROGRAM
How it Works
The
OBCFPP can compensate Ontario producers for 90 per
cent of their losses when a licensed dealer defaults
on a payment. The program is financed by fees from
both sellers and auction markets.
What Beef
Producers Must Do
The
program is set up to protect beef producers, but
they must also act to limit their risk. To ensure
sales are covered under the program, sellers must
follow these steps.
-
Always
deal with a licensed dealer. Don't risk selling to
an unlicensed dealer. If there is any doubt, ask to
see the licence.
-
Ensure
payment is made within 2 business days of sale. Day
of sale can mean:
-
day of purchase where price is
determined on a per head basis
-
Ensure
payment is received in a timely manner. If you
receive payment:
-
Deposit the cheque within 5 banking days of
receiving it.
-
Do
not extend credit to the dealer. This means that
you should never sell to the same dealer if the
payment for a previous sale is late.
-
If
a payment is not received on time, or if a
cheque bounces, a producer must notify the
OBCFPP Program Manager immediately.
-
If
you are going to make a claim, you must apply
within 30 days of when the payment was due.
Producers may also make a claim if a dealer
has ceased operation or if a dealer's assets
were placed under a trustee or receiver.
Seeking
Compensation
A claim for compensation will be considered
if it involves:
-
a producer selling to a licensed dealer;
-
a licensed dealer selling to another
licensed dealer.
Claims are reviewed by the Livestock
Financial Protection Board, which includes a
broad representation of the beef industry.
The program will pay 90 per cent of any
approved claim.
Protection for Auction Market Operators
Sales made by public auction are also
covered when the auction market is licensed
under the Livestock Community Sales Act or
when a public auction carried on by a
co-operative corporation sells to a
producer, provided they are a licensed
dealer. In these circumstances, where an
auction market sells to a producer who
defaults on payment, compensation is 70 per
cent, up to a maximum of $75,000. There will
be no compensation for claims of less than
$5,000.
Private treaty sales made to producers by
auction market operators or co-operatives
are not covered by this provision.
When making a claim under this limited
compensation section, non-payment must be
reported within 2 days. When dealing with a
feeder finance co-operative, non-payment
must be reported within 10 days of auction.
Licencing the Dealer
Under the Ontario Beef Cattle Financial
Protection Program, dealers are licensed by
OMAFRA. Dealers include packing plant
operators, abattoir operators, auction
market operators and country dealers.
Dealer applications, along with financial
statements, are reviewed by the Ministry
before the licence is granted. A dealer who
fails to make prompt payment, defaults on
payment or issues an NSF cheque may lose
their licence.
The
Board
The Livestock Financial Protection Board is
an eight-member board that deals with claims
and administers the compensation fund. The
Board approves or refuses payments of claims
and recovers any moneys paid out by the
Board.
The Board is appointed by the Minister of
Agriculture, Food and Rural Affairs based on
nominations from the:
-
Ontario Cattlemen's Association
-
-
Ontario Livestock Auction Markets
Association
-
Ontario Independent Meat Packers and
Processors
-
Ontario Livestock Dealers Association
-
The cost of operating the Board and the
financial responsibility review is paid for
by the OBCFPP, while administration and
enforcement costs are covered by OMAFRA.
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