The Fresh Produce Association of the Americas (FPAA) believes the Tomato Suspension Agreement proposed by the U.S. Department of Commerce in July has deeply flawed provisions that infringe upon federal laws and are unlikely to survive antitrust and other legal actions that are sure to arise. They say the Mexican growers’ proposal from August 5 identifies a path forward.
“We have made two trips to Washington to meet with the Department of Commerce to explain how the Commerce proposal gives unfair advantage to one type of U.S. seller of Mexican tomatoes over other U.S. sellers of Mexican tomatoes, yet the unjustifiable provisions remain,” said Jungmeyer. “The Commerce proposal would allow repackers to profiteer on the condition of Mexican tomatoes at destination. By contrast, the new Mexican proposal provides a clear path to remove defective tomatoes from the marketplace. This is a step in the right direction.”
In written submitted comments and in a recent meeting with Commerce, FPAA has stated that Commerce is going beyond its statutory authority, particularly with sales price adjustments for defective tomatoes.
“When Congress passed PACA in 1937 and gave USDA jurisdiction to protect the rights of sellers and buyers of perishable agricultural commodities, it never imagined that another government agency like Commerce would decide that some American companies would get protections, while others would not,” Jungmeyer said.
Addressing another provision, FPAA believes a new suspension agreement must remove the mandate for USDA to inspect every imported lot of Mexican tomatoes, an action that the Mexican government has said would invite reciprocal inspections on U.S. agricultural products.
They cite USDA records showing that 99 percent of tomatoes meet standards upon arrival at customers’ warehouses. The FPAA also noted the inspections would add more than $270 million in costs.
Jungmeyer added, “Many of our members are dismayed because they believe that Commerce has not verified the claims made by the FTE and are acting solely upon accusations that we know are untrue. Alternatively, it may be that Commerce has not understood our concerns, possibly because they have not closely examined the credibility of the unsubstantiated FTE claims.”
“We are hopeful that a new agreement will not include provisions that add 100% inspections or infringe upon PACA’s role in the marketplace,” Jungmeyer said. “Our Members have told us loud and clear about the antitrust concerns they see, and we hope Commerce will hear us. So far, our comments are being ignored.”