Standards & Policies

Fair Trade Certified standards are set by Fairtrade Labelling Organizations International (FLO), in consultation with Fair Trade Certified stakeholders, such as producer organizations and licensees, and organizations such as TransFair Canada. FLO publishes a standards workplan each year.

Trade Policies are set by the certifiers, FLO-CERT internationally and TransFair Canada in Canada.

Producer Standards

Producer standards cover organisational transparency, as well as environmental and social norms. There are generic standards for small farmers and for hired labour situations. There may also be small farmer product specific standards and hired labour product specific standards (e.g Part B of the Nuts and Oil Seed standard).

Trade Standards

Trade Standards are found in Part C of the small farmer product specific standards and hired labour product specific standards, however the Trade Standards for a product are the same for small farmer and hired labour situations. Note that some products do not have smaller farmer standards (e.g. sports balls and flowers) and some products do not have hired labour standards (e.g. coffee, cocoa, sugar).

Trade Standards have special requirements for companies that buy from the producing country.

They must:

Pay the minimum guaranteed price to the producer group
Pay a Fair Trade Premium that producers can invest in community development
Pay pre-harvest lines of credit are given to the producer group if requested, of up to 60% of the purchase price
Sign contracts that allow for long-term planning and sustainable production practices

Obligations of Canadian Licensees

To become and remain licensed, companies selling products bearing the Fair Trade Certified mark must fulfill these requirements:

If they sell conventional products in addition to Fair Trade Certified products, maintain business systems that distinguish between the two
Have records that trace finished Fair Trade Certified products back to raw materials
Report transactions with traders/producer organizations on a quarterly basis including payment of a set license fee per product in relation to sales for that quarter
Submit to an audit of records
Use the Fair Trade Certified mark according to norms designed to protect consumers