Ontario Minister of Agriculture releases decision on Ontario Pork

In February, I reported on a decision from the Agriculture, Food and Rural Affairs Tribunal reinstating Ontario Regulation 419, which required hog producers to sell their hogs through a marketing board, Ontario Pork: Ontario Pork recovers its marketing powers.  The Tribunal decision is available at: Minnema v. Ontario Farm Products Marketing Commission.

Last Thursday, the Minister of Agriculture in Ontario overturned much of the Tribunal's decision.  Ms. Mitchell treads lightly in her reasons for the decision, saying:

Before proceeding with my decision, however, I would first like to point out that my decision should not be taken to mean that I do not have confidence in the Tribunal. Indeed, I believe that the Tribunal serves an important function within Ontario’s regulated markets. However, and as the Tribunal readily pointed out in its decision, the adversarial process is not necessarily well-suited for resolving complex policy-laden questions. Often, the parties present their favored position(s) without examining or providing information to capture the larger policy issues in which their dispute(s) arise. This, in turn, leaves the decision-maker in a difficult position.

Ms. Mitchell then goes on to restore the earlier policy decision to open up the marketing of hogs in Ontario beyond Ontario Pork:

I support the Commission’s open market approach for the Ontario Hog Industry. The Commission’s decision provides for a clearer path forward. It will help to create stability in Ontario’s Hog Industry by resolving an outstanding issue that has been ongoing for more than 10 years now.

I also think that it is important to note that my policy choice of adopting an open market system for Ontario’s Hog Industry does not prohibit the Board from offering marketing services to hog producers. It is clear from the submissions I received that some producers would prefer to continue to use the Board’s marketing services if an open market system were to be implemented. For example, either party to an agreement would still be able to rely on the Board’s expertise to review and provide comments on contracts if they wanted. Further, I note that the Board’s submissions contemplate the Board continuing to offer marketing services in the near term. And, I would encourage the Board to continue to offer its marketing expertise to Ontario’s Hog Industry.

The Board would, however, have to operate somewhat differently. For example, the Board would have to administratively separate its marketing side from its regulatory side to eliminate any potential conflict of interest and/or bias issues of being both the regulator and the regulated. Such a division would also have to include separating any fees the Board may receive for its regulatory functions from its marketing functions in order to ensure that the Board is not receiving an unfair competitive advantage over others who may want to offer marketing services. If the Board is to continue to market hogs, I expect that it will consult with the Commission on how best to separate its marketing function from its regulatory function.

Read the full decision at: Minister's decision.