Chicken board had authority to cap sales to Quebec, Tribunal rules
Thursday, April 14, 2011
by BETTER FARMING STAFF
A provincial appeals Tribunal has ruled that the Ontario chicken board acted within its authority when it capped the number of chickens that could be shipped to Quebec for processing in 2009.
The temporary moratorium’s effect on the interprovincial movement of chicken was incidental, wrote Ontario Agriculture, Food and Rural Affairs Tribunal members in their April 14 decision. It “does not does not change the regulation's core character which is controlling marketing transactions that occur in Ontario.”
The three Tribunal members who heard the case — John O’Kane, vice chair, Kirk Walstedt, chair and Tim Mousseau, a member — also noted that the moratorium is being phased out as an agreement between Ontario’s and Quebec’s chicken industries, introduced this year, takes effect.
Stevensville producer Henry Bos had appealed the moratorium, claiming that it removed his freedom to sell his chickens to whomever he wants. He could not be reached for comment on the ruling.
In a 2010 interview he noted that about a fifth of his birds normally go to Quebec. Because his contract to supply the birds was already in place when the moratorium was established, those sales were not affected.
Bos also questioned whether Chicken Farmers of Ontario (CFO) had the authority to introduce the moratorium because it applied to interprovincial shipments, which normally fall under federal jurisdiction. However, he decided not to pursue the question, which would have meant launching a constitutional challenge.
The Tribunal also decided that the question did not need to be pursued any further. “Having concluded CFO has the authority under provincial legislation to enact the underlying policy and regulation and the 2009 amendments,” the decision states, “it is unnecessary for us to consider whether CFO has authority under delegated federal legislation.”
According to the written decision, chicken board chairman John Maaskant noted during the hearing that Bos was the only producer challenging the moratorium. No one appealed a similar moratorium imposed in Quebec at the same time, Maaskant said.
The Ontario moratorium capped the number of chickens that could be shipped to Quebec for processing at 2009 levels. Kevin Thompson, executive director of the Association of Ontario Chicken Processors and Maaskant explained that the measure was needed to stabilize Ontario’s industry.
While Ontario producers have always shipped a small number of birds to Quebec, the number began to grow significantly beginning in 2003 or 2004. By 2009, Ontario sent more than 28.6 million kilograms to Quebec. Thompson attributed the growth to Quebec processors offering a premium price.
According to the tribunal decision, Thompson noted that Ontario’s processing industry relied on an assured supply from the supply-managed producers. In turn, Ontario’s supply-managed producers’ quota was dependent on the marketing projections of the province’s processors.
When their supply dwindled Ontario processors turned to Quebec producers.
Thompson “pointed out the economic inefficiency of trucks carrying Ontario chickens passing trucks carrying Quebec chickens, each destined for processing plants in different directions,” the decision states.
In January, the chicken industries in both provinces reached an agreement about the issue. It allows producers and processors to establish contracts where they choose. But it also gives Ontario processors advance opportunity to arrange contracts with Ontario chicken producers, the tribunal decision says. The same type of arrangement is in effect in Quebec. BF