The Issues to Take into Consideration for the International Fresh Fruit and Vegetable Sales Contracts

The average annual fruit and vegetable consumption in Turkey is calculated as 50 million tons. Unfortunately, the 24-40%, namely 12-20 million ton of the production incurs loss after harvest and lost its ergonomic value or is annihilated completely.

The average annual fruit and vegetable consumption in Turkey is calculated as 50 million tons. Unfortunately, the 24-40%, namely 12-20 million ton of the production incurs loss after harvest and lost its ergonomic value or is annihilated completely. This amount is more than the total production of some EU member countries. Since the loss rate is between 20-25% for the developed countries, it can be more manageable. I also would like to remind that we can only export 4-5% of the fresh fruit and vegetable we produce in addition to the great amount of the loss.

Within this scope, we face the truth that we have great potential for international trade, however we cannot use it efficiently.

As an international commercial legal expert, I would like to share the issues to take into consideration and some negative issues faced during application while carrying out the relevant commercial operations in order to provide a legal perspective for our exporters about the issue which has a great potential for out international trade.

Commercial Process Starts with the Flowering or Planting Stages of the Fruit or Vegetables

One of the basic mistakes we made is that we see the fruit or vegetable to be subjected to the international trade as a product, and that we think only the appearance and freshness of them is the criteria for quality. However, fruit and vegetables have other lives inside and around them. Their life-circles start with their planting and flowering stages.

Within this scope, it is necessary to remove all kinds of factors causing diseases and decreasing the quality of the product from the field where the production will take place. For instance, it is possible for the products, leaves and branches dropped on the soil from the previous harvest to infect the products which are at the planting or flowering stages with the disease-spreading spores and bacteria. In sum, the most important factor affecting the product quality is carrying out the production on a field where the diseases are removed.

Importance of Disinfection on Growing Stage

Disinfection is an issue requiring great attention and care for fruit and vegetable production to get rid of the diseases and to protect them. Besides the current discussions, it is crucial to carry out disinfection operations through scientific methods and under the control of experts especially for the products subjected to exportation. One of the most frequent questions asked to me is that which country’s rules should we apply related to disinfection? I would like to explain this issue with an example: Let’s think that the products were not allowed to enter into the country since the German customs authorities detected contradictions to their food regulations as a result of the examinations which they made on the products we exported to Germany. In this case, which of the following regulations should be applied related to the pesticide residuals on the products for the relationship between the buyer and the seller: Turkish Food Regulations or German Food Regulations? The short answer for this question is that if there is any kind of contrary agreement, the Turkish Food Regulations should be applied as the laws for the seller. In other words; in case the product is produced in accordance with the Turkish Laws, the seller will not be considered to violate the agreement since the German Customs Authority did no allow the products into the country; the buyer has to pay for the products (I suggest for the ones who are concerned to read the widely-known decision named as “Mussel Case” of the Federal Court of Germany).

However; after this general explanation, I also would like to emphasize that the market regulations where the products are offered for the consumers and managing the expectations are crucial for the tradesperson in order to provide continuity in trading. Therefore, in the condition within the model agreement named as “COFREUROP” prepared by the European Union for Production and Supply of Fruit and Vegetables (EUROFEL) for its own members for the regulations related to labelling and packaging, it is clearly indicated that “the rules of the country where the product will put on the market will be applied”. Within this scope, I suggest for the ones dealing with trading fresh fruit and vegetables to follow the mandatory regulations of the market related to the quality of the products by demanding them from the buyer if necessary.

Harvesting and Storing is Crucial to Provide Valuable Products

Harvesting is the stage which the fruit or vegetable leaves its plant and continues its life as an independent thing. Harvesting to be carried out on the right time, with the right equipment and professional personnel has the key role for the fruit or vegetable to remain its health and therefore its appearance and commercial value.

On the other hand, keeping the products at the right temperature and in the storages or transportation vehicles where the right hygiene conditions are provided will contribute to decrease the contradictions between the buyer and the seller.

It Should Not Be Forgotten That the Buyer Is Liable to Notice Defects After Delivery

The most common complaint I have heard from our international tradespeople dealing with international fruit and vegetable trading is that they are not notified about the defects related to the products they delivered and the defects are appropriated from their receivable accounts or they receive demands after being notified that their products have defects months after the problem-free delivery. Those situations put our exporters into difficult positions by contradicting with the international commercial laws and create unacceptable conditions.

How do the courts of countries of European Union which is our biggest exportation market deal with those kinds of contradictions related to the products subjected to international trade? I provide the research I made about this issue for you, my dear readers:

  • The Court of Dusseldorf, Germany decided that the examination and notification should be made within 7 days from the date of loading one of its decisions made for pickle exportation in 1992.
  • It was decided in the Court of RB Mechelen, Belgium that it is necessary to report the faults on the products within a couple of days for the decision made about tomatoes in 2002.
  • The Court of Saarbrucken, Germany decided that it is necessary to report faults with the delivery of the products for the fresh flowers in 1998.
  • The Court of Netherlands decided that it is necessary to provide notification by examining the products right after the delivery for leek exportation in 2003.
  • The Court of Oberster, Belgium decided that it is necessary to check the products and provide notification for the faults with “immediate notice” since the COFREUROP model agreement is applied for the pineapple importation in 1998.

Consequently; it is a rule in terms of international commercial laws for the seller to show sensitivity to liabilities for productions with high quality and suitable for human health and for the buyer to report the faults of the products right after the examinations carried out after delivery especially while carrying out fruit and vegetable trading operations. I hope you, our dear tradespeople carry out your activities with the awareness of those rights and obligations for your commercial relationships.

Result and Suggestions

It is clear from the above explanations that our country does not get the satisfying share from international fresh fruit and vegetable, however it also has a great potential with the right steps. Within this frame, I suggest our international tradespeople to take the following issues into consideration while carrying out their commercial relationship and preparing agreements:

  1. Creating proofs with the reports, photographs, determinations indicating that the planting and production stages are in accordance with the agreed scientific principles and rules has an important role in settling disputes.
  2. I suggest for them to be in communication with the buyer related to the harvesting and storing processes, and if possible, to exchange correspondences with them about that they know and accept the conditions.
  3. Informing the seller about the rules of the country where the products will be put into the market and about the documents necessary for packaging, crating, transportation, labelling and exportation by the buyer will provide great advantage for settling the disputes arising later from the intervening/mandatory rules of the country of exportation.
  4. Days and even hours are vital for the fresh fruit and vegetable trading. Accordingly, the party organizing the transportation and logistics is crucial.
  5. It is necessary for the quality of the product to examine them immediately and notify the other party about the faults in the international commercial law. All kinds of operations contradicting this application carried out by the buyer should be objected and for the sake of the benefits from the relationship, the buyer should be reminded that those actions and operations are not in conformity with the international commercial law even if their costs are covered.

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