Kenya Coconut Development Authority Order

Jurisdiction
Kenya
Citation
Legal Notice 165 of 2007
Primary work
State Corporations Act
Date
Language
English
Type
Legislation
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LAWS OF KENYA

STATE CORPORATIONS ACT

KENYA COCONUT DEVELOPMENT AUTHORITY ORDER

LEGAL NOTICE 165 OF 2007

  • Published in Kenya Gazette Vol. CIX—No. 60 on 31 August 2007
  • Commenced on 31 August 2007
  1. [Amended by 24th Annual Supplement (Legal Notice 221 of 2023) on 31 December 2022]

1. Citation

This Order may be cited as the Kenya Coconut Development Authority Order.

2. Interpretation

In this Order, unless the context otherwise requires—"Authority" means the Kenya Coconut Development Authority established by this Order;"Board" means the Board of the Authority established by paragraph 4;"Cabinet Secretary" means the Cabinet Secretary for the time being responsible for matters relating to Agriculture;"Committee" means the Coconut Nurseries Committee established under paragraph 19 of this Order;"dealer" means a person, company, co-operative society, association of persons or firm engaged in buying coconut produce and by-products for resale in the local or export market and includes exporters, importers, processors, agents and marketing agents;"grower" means a small or large scale producer of coconut who grows and sells to a dealer;"inspector" means any person authorized in writing by the Agriculture Secretary or the Authority to carry out inspections in the coconut industry;"nursery operator" means a person who has planted or who intends to plant, multiply or grow coconut from seeds or any vegetative parts which may be used to multiply the coconuts for own use or for sale;"planting material" means any plant raised from the seed or from the vegetative part of a plant in a coconut nursery.

Part II – Establishment of the authority

3. Establishment of the Authority

There is hereby established a State corporation to be known as the Kenya Coconut Development Authority which shall be a body corporate in accordance with section 3 of the Act.

4. Board of the Authority

(1)There shall be a Board of the Authority consisting of the following members—(a)a Chairperson appointed by the President;(b)the Principal Secretary of the Ministry for the time being responsible for agriculture;(c)the Principal Secretary of the Ministry for the time being responsible for finance;(d)the Principal Secretary of the Ministry for the time being responsible for regional development authorities;(e)the Principal Secretary of the Ministry for the time being responsible for co-operative development and marketing;(f)the Managing Director of the Authority appointed under paragraph 8;(g)five members appointed by the Cabinet Secretary and who have an interest in the coconut industry and other relevant qualification or experience.
(2)The Chairperson and members appointed under subparagraph (1)(g) shall serve for a term of three years, which may be renewed once.
(3)The Chairperson and members of the Board appointed under subparagraph (1)(g) shall cease to hold office if one—(a)resigns his office as such in writing to the appointing authority;(b)is absent from three consecutive meetings of the Authority without justifiable cause;(c)is adjudged bankrupt;(d)is incapacitated by prolonged physical or mental illness;(e)ceases to represent the interest in respect of which he was nominated to the Board;(f)is otherwise unable or unfit to discharge the functions of the office;(g)is convicted of a criminal offence.

5. Functions of the authority

The Authority shall in respect of coconut industry have the following functions. These shall be to—(a)provide advisory service on matters related to coconut industry to the Government and to the industry for planning purposes;(b)collect and collate data, maintain a database on coconut industry, document and monitor the industry through registration of all players in the industry;(c)assist in the production, processing, grading, storage, collection, transportation and warehousing of all the produce and by-products destined for markets;(d)arbitrate on disputes arising between the growers and any of the players or among other players in the industry;(e)vet and witness contracts entered into between the growers and any other players or between other players in the industry before they are executed;(f)appoint agents for the implementation or performance of any function of the Authority under this Order; and(g)monitor imports and exports of coconut produce and by-products for efficient management of the coconut industry.

6. Powers of the board

The Board shall have all powers necessary for the proper performance of the functions of the Authority under this Order and, in particular but without prejudice to the generality of the foregoing, the Board shall have power to—(i)regulate the production, post-harvest handling and marketing of coconut produce and by-products;(ii)impose restrictions on the quantity and quality of coconut produce and by-products to be imported or exported;(iii)raise such funds on such terms and for such purposes as may be approved by the Cabinet Secretary after consultation with the Cabinet Secretary for the time being responsible for Finance;(iv)establish, acquire and operate produce handling facilities on its own or through private public partnerships, for the purpose of promoting production, marketing and processing of coconut produce and by-products;(v)investigate and research into all matters relating to the industry generally and in particular production, processing, value addition and marketing of coconut produce and by-products;(vi)regulate coconut nurseries and their operators;(vii)destroy any planting material in unregistered coconut nurseries;(viii)initiate, promote and enforce standards for labeling, packaging, grading, transport and storage of coconut produce and by-products and ensure observance and compliance with local and international standards in liaison with relevant organizations or bodies.

7. Meetings of the board

(1)The Chairperson shall preside at all meetings and in the absence, the other members present at the meeting shall appoint one of the members to act as Chairperson at that meeting.
(2)The quorum for the Board meeting shall be two-thirds of the members.
(3)The Board may co-opt, for such period as it may think fit, not more than three persons whose assistance or advice it may require, but persons so co-opted shall not be counted as members for the purpose of forming a quorum or shall not be entitled to vote at any meeting of the Board.
(4)Every decision of the Board shall be by a simple majority of the members present and voting but the Chairperson or the person appointed to be the Chairperson under subparagraph (1) shall have a casting as well as a deliberative vote.
(5)Subject to this Order, the Board shall regulate its own proceedings.

8. Managing director

(1)There shall be a Managing Director appointed by the Cabinet Secretary on the recommendation of the Board and who shall be the secretary to the Board.
(2)The Managing Director shall possess a degree in agricultural sciences and be well versed in the coconut industry.
(3)The appointment of the Managing Director shall be for a four year contract renewable only once for a period not exceeding four years.

9. Appointment of staff

The Authority shall appoint upon such terms and conditions as it thinks proper such officers and employees as it deems necessary for the efficient operation of the Authority.

10. Remuneration

The Authority shall pay such remuneration, fees, allowances and such other reimbursement to members of the Board as may be approved by the Treasury.

11. Delegation of powers

The Board may delegate any of its powers to any of its committees or to the Managing Director.

12. Execution of documents

(1)The seal of the Authority shall be authenticated by the signature of the Chairperson and the Managing Director, or by either the Chairman or the Managing Director, together with one member other than an ex officio member of the Board authorized in writing by the Authority in that behalf.
(2)Any document, other than a document which is required by any other law to be under seal, made and any decision of the Authority, may be signified under the hand of the Chairperson, or the Managing Director or of any other member of the Board or any other person authorized in writing by the Board in that behalf.

Part III – Financial provisions

13. Funds of the authority

The funds and assets of the Board shall consist of—(a)such monies or assets as may accrue to or vest in the Board, in the course of the exercise of its powers or the performance of its functions under this Order;(b)any moneys which may in any manner become payable to or vested in the Board in respect of any matter incidental to the carrying out of its functions;(c)any gifts as may be given to the Board;(d)such moneys as may be appropriated by Parliament for the purposes of the Board; and(e)all moneys from any other source provided, donated or lent to the Board.

14. Financial year

The financial year of the Board shall be the period of twelve months ending on the thirtieth day of June in each year.

15. Annual estimates

(1)At least three months before the commencement of each financial year, the Board shall cause to be prepared estimates of the revenue and expenditure of the Board for that financial year.
(2)The annual estimates shall make provision for all estimated expenditure of the Board for the financial year concerned, and in particular shall provide for—(a)the payment of the salaries, allowances and other charges in respect of the officers, members of staff or agents of the Board;(b)the payment of the pensions, gratuities and other charges in respect of the retirement benefits payable to the members of staff of the Board;(c)the proper maintenance of the buildings and grounds of the Board;(d)the proper maintenance, repair and replacement of the equipment and other movable property of the Board; and(e)the creation of such reserve funds to meet future or contingent liabilities in respect of retirement benefits, insurance, replacement of buildings or equipment, or in respect of such other matters as the Board may deem fit.
(3)The annual estimates shall be approved by the Board before the commencement of the financial year to which they relate and, once approved, the sum provided in the estimates shall be submitted to the Cabinet Secretary for approval.
(4)No expenditure shall be incurred for the purposes of the Board except in accordance with the annual estimates approved under subparagraph (3), or in pursuance of an authorization of the Board given with prior written approval of the Cabinet Secretary, and the Permanent Secretary to the Treasury.

16. Accounts and audit

(1)The Board shall cause to be kept proper books and other records of accounts of the income, expenditure, assets and liabilities of the Board.
(2)Within a period of three months after the end of each financial year, the Board shall submit to the Auditor-General or to an auditor appointed under subparagraph (3), the accounts of the Board, in respect of that year, together with—(a)a statement of income and expenditure during that financial year; and(b)a statement of the assets and liabilities of the Board on the last day of that financial year.
(3)The accounts of the Board shall be audited and reported upon in accordance with the provisions of the Public Audit Act (Cap. 412B).

17. Investment of funds

(1)The Board may invest any of the funds of the Board in securities in which the Board may by law invest trust funds, or in any other securities which the National Treasury may, from time to time, approve.
(2)The Board may place on deposit, with such bank or banks as the National Treasury may approve from time to time, any moneys not immediately required for the purposes of the Board.

18. Annual report

(1)The Board shall, within three months after the end of each financial year, prepare and submit to the Cabinet Secretary, a report on the operations of the Board for the immediately preceding financial year.
(2)The Cabinet Secretary shall lay the annual report before the National Assembly as soon as is practicable after the National Assembly next sits after the Cabinet Secretary has received the report.

Part IV – Quality assurance in production and marketing

19. Establishment of coconut nursery committee

(1)There shall be a Coconut Nursery Committee of the Board consisting of the following—(a)the Agriculture Secretary;(b)the Managing Director of the Authority;(c)the Director, Kenya Agricultural Research Institute;(d)the Managing Director, Kenya Plant Health Inspectorate Service;(e)the Managing Director, Coast Development Authority; and(f)one representative of registered private sector nursery operators.
(2)The Committee shall from time to time certify the minimum nursery standards in respect of coconut palm that is grown.
(3)The Committee may co-opt, for such period as it may think fit, any person whose assistance or advice it may require.

20. Registration of nursery

(1)No person shall, after the publication of this Order, establish or operate a coconut nursery in any area unless that nursery is registered in accordance with this Order.
(2)Every application for a certificate of registration for a coconut nursery shall be made to the Authority before establishment of such a nursery as set out in Form A of the First Schedule.
(3)The certificate of registration as set out in Form B of the First Schedule shall be renewable after three years and only applicable for the area inspected.

21. Conditions before registration

No person shall be issued with a certificate as a nursery operator under paragraph 20 unless an inspector—(a)has visited and inspected the site and confirmed it as suitable for a coconut nursery;(b)is satisfied that the planter or his agent has adequate knowledge of nursery management and coconut production techniques.

22. Certificate not transferable

(1)No person to whom a certificate of registration is issued under paragraph 20 shall sell, lend, transfer or otherwise dispose of the certificate without the prior written permission from the Authority.
(2)The operator of a coconut nursery shall display the certificate of registration for inspection at all times.

23. Restriction on transfer of planting materials

No person shall transfer coconut planting materials from one part of the country to another unless that person has obtained a movement permit in the form set out in Form C of the First Schedule to this Order from the District Agricultural Officer of his area.

24. Approved source of seeds

(1)Every coconut nursery operator shall procure seeds from sources approved by the Committee.
(2)Coconut seeds shall be grown according to procedures on nursery management as laid down by the Committee.
(3)Seedlings shall be inspected by an inspector while still in the seedbed before they are approved for transplanting.

25. Approved planting material

(1)The Authority shall prescribe the manner of procuring of planting material by the growers and the manner of dealing with planting material generally.
(2)Every grower shall comply with any requirement of the Authority under subparagraph (1).
(3)A person who fails to comply with subparagraph (2) commits an offence.

26. Records of sale

Every nursery operator shall keep accurate records of distributed planting materials indicating the buyer’s name, district, location, sub-location and postal address, and quantity purchased and shall produce such records on demand for the purposes of inspection.

27. Restriction on sale of planting materials

(1)No person shall distribute any planting material without a plant health certificate issued by the Authority.
(2)Any person who contravenes subparagraph (1) commits an offence and shall have his nursery certificate revoked, his plants destroyed by the Authority in addition to any other penalty which the court may impose under this Order.
(3)The operator of a coconut nursery which is destroyed under subparagraph (2) may re-apply for registration after a period of two years.

28. Compensation

(1)No compensation shall be payable in respect of any planting material destroyed under paragraph 27 of this Order.
(2)No suit, prosecution or other legal proceeding shall lie against an inspector for anything done in good faith and without negligence under this Order or under any rule made thereunder.

29. Selection of production sites

(1)Every producer shall select a site for production of coconuts and such a site shall not be in the land that has proximity to an area contaminated by industrial, faecal or domestic organic waste.
(2)The selected site and production practices shall minimize detrimental impact on environment while conserving nature and wildlife in accordance with the provisions of Environmental Management and Co-ordination Act (Cap. 387).
(3)Every producer shall draw farm plans and such plans shall indicate the selected sites and the facilities that have been strategically sited to ensure workers’ occupational health and safety, and to prevent contamination of crops or produce and packaging materials.
(4)The areas selected for production of coconuts shall be indicated in the farm plans in relation to workers’ housing, toilets, drinking water points, waste disposal pits, waste water treatment, utility stores, and social amenities.
(5)A person who contravenes the provisions of this paragraph commits an offence.

30. Compliance by producers

Every producer shall comply with good agricultural practices in relation to production, site selection, soil and water analysis, record and document control, hygiene, cleanliness and workers welfare.

31. Coconut produce and by-products traceability

Every producer and every dealer shall develop, implement and monitor a precise and detailed traceability system to ensure that consumers are informed correctly on the coconut produce and by-products which addresses—(a)origin, nature, quantities and use of farm inputs;(b)field operations from planting to harvesting of the crop;(c)agro-chemicals and usage particularly related to authorized safe uses, application rates, dates of usage, and pre-harvest intervals;(d)nature, quantities and consignees of all the coconut produce and by-products sold.

32. Periodic Residue Analysis

Every producer, dealer and processor shall undertake periodic residue analyses based on risk assessment by an approved laboratory and provide a written action plan and in the event that maximum residue level is exceeded, document the remedial action taken.

33. General provisions for produce handling facility

(1)The produce shall be handled, packaged, prepared, processed and stored hygienically in establishments approved as set out in the Second and Third Schedules to this Order.
(2)The produce shall be appropriately packaged as set out in the Fourth Schedule to this Order.
(3)The produce shall be stored and transported under satisfactory conditions of hygiene as set out in the Fourth Schedule to this Order.

34. Waste disposal

Every dealer shall comply with the procedures for the safe and hygienic disposal of rejected produce, organic waste, waste water and other rubbish and which shall be done in an environmentally acceptable manner.

35. Application for registration of produce and by-products dealers

(1)No person shall process, import, export, or act as an agent or dealer of coconut produce and by-products unless he is registered by the Authority.
(2)An application for a registration certificate shall be as set out in Form D in the First Schedule.
(3)Every certificate of registration issued shall be as set out in Form E of the First Schedule.
(4)Every registration certificate shall remain valid for a period of three years from the date of issue.
(5)Any person who contravenes the provisions of subparagraph (1) commits an offence and shall be liable to a fine not exceeding six thousand shillings or to imprisonment for a term not exceeding six months, or to both.

36. Restrictions on registration

(1)No registered dealer shall—(a)sponsor the growing of coconuts for trading without informing the Authority in writing and any production schemes so sponsored shall be regulated by contract as set out in the Fifth Schedule;(b)collect produce from sponsored production schemes unless authorized in writing to do so by the sponsoring firm;(c)distribute planting materials to farmers without a plant health certificate;(d)distribute any pest control product to farmers which has not been approved and recommended under the Pest Control Products Act (Cap. 346);(e)return produce collected from the farmers or suppliers contrary to the contract agreement as per the Fifth Schedule.
(2)A registered dealer shall—(a)sign a contract with the producer and register such contract with the Authority as set out in the Fifth Schedule;(b)indicate in the contract the produce price, quantity and quality requirements;(c)strive to attain the highest produce quality standards;(d)adopt and use the specified national coconut logo as prescribed by the Authority;(e)notify the Authority of any dealer who contravenes any contract or order within 30 days after the date of default.

37. General penalty

Any dealer who commits an offence under this Order shall be liable to a fine two times the value of the produce or to imprisonment to a term of six months and shall in addition, where applicable, have his registration certificate cancelled.

FIRST SCHEDULE

FORMS

FORM A   (para.20(2))
PART 1
Application for Registration of Coconut Nursery
1. Full Name of Applicant ........... ID No./Reg. No. ...........
2. Address ...........................................
3. Tel ................. Fax .................... E-mail ..............
4. District ...............................................................
5. Division ....................................................................
6. Location ....................................................................
7. Sub-Location ..................................................................
8. L.R. No. .........................................................................
9. Altitude ..........................................................................
10. Water source: Rivers/Dam/Boreholes, others (specify).......
11. Type of material to be produced:
  Crop/variety No. of seedlings Source of Seed
  ............................. ............................ ........................
  ............................. ............................ .........................
  ............................. ............................ .........................
12. I confirm that I shall abide by the regulations and ensure that all seed material for planting has been inspected and approved.
13. Applicants signature ......................................................................
  Date .................................
PART II FOR OFFICIAL USE ONLY
14. Recommended/Not recommended
  Remarks ......................................
  Site inspected by .....................................
  District .............................................
  .........................................
(Inspector)
  Date: ....................................................
PART III  
15. Approved/Not Approved .............................  
............................................................................................  
Managing Director  
Kenya Coconut Development Authority.  
Date .....................................................................  
Note:Application for registration of Coconut nursery should be sent to the Managing Director, Kenya Coconut Development Authority.
FORM B           (para.20(3))
             
Certificate of Registration of Coconut Nursery
Messrs.............................................................. of P.O. Box ................................is/are registered to operate a Coconut nursery for the year 20 ........ Located at ............................ sub-location ....................................... LR No. ............................The following planting materials will be produced
Types Numbering of planting stock
...................................................................................................
...................................................................................................
...................................................................................................
Registration No. .................................................
Signed ...........................................................
(Managing Director)
Kenya Coconut Development Authority
Date: ..........................................................
 
CONDITIONS
1.   This certificate is valid for 3 years from date of issue.
2.   This certificate is not transferable to any other person, or nursery site.
3.   All seed must be from approved source.
4.   No sale of planting material before final visual inspection and approval
5.   All approved planting materials which are not distributed during the approved season will be subject to re-approval before distribution.
6.   The application for renewal of this licence shall be made to the Managing Director, Kenya Coconut Development Authority so as to reach at least 3 months before expiry date.
FORM C   (para.23)
 
PERMIT FOR THE MOVEMENT OF PLANTING MATERIAL
    Permit No. ....................................
Name of permit holder
Address
Vehicle Registration No.
Quantity to be moved (specify types and names)
.....................................................................................................................
.....................................................................................................................
.....................................................................................................................
Date of movement ...................................................................................
To be moved from
District .................................................................................................
Division ................................................................................................
Location ............................................................................................
Sub-Location ...................................................................................
L.R. No. ........................................................................................
........................................................................................... (Registered nursery)
Signed on behalf of the Authority by .........................................................
District Agricultural Officer
For: Managing Director
District .............................................................. Date ...................................................................
Note:

This permit is valid for only the specified consignment and date of movement
FORM D   (para 35(2))
APPLICATION FOR REGISTRATION AS A PRODUCE/BY-PRODUCTS DEALER
1. (a) Full name of Applicant
  (b) Postal Address
    Registered Office:
    L.R. No. ........................ Street .........................
(c)   Tel. No. .......................... Fax No. ..........................
(d)   E-mail ............................. Website .................................
     
2.   List of shareholders/Directors, their citizenship and percentage shareholding for each.
    NAME   Citizenship   %Shares
    ........................   ......................   .......................
    ........................   ......................   .......................
    ........................   ......................   .......................
    ........................   ......................   .......................
 
3. (a) Location of offices .......................................
    Street ...............................................
    L.R. No. .............................................
    Telephone: ..........................................
 
  (b) Location of Pack houses
    Street ..................................................
    L.R. No ....................................................
    Tel. .......................................................
4. VAT Registration No. ..................................
5. PIN ................................................................
6. Year of establishment of Company and Registration No. (attach copy)
7. Type of dealership (Tick as appropriate)
  Exporter/marketing agent/processor/dealer/buyer/agent/supermarket/any other (specify) .................................
8. Name and address of Bankers ..................................
9. Overseas markets targeted/supplied .......................................
10. Types of produce for exports ..........................................
11. Sources of supply for produce ...........................................
(Attach copies of ID of Directors, company registration certificate and current trade licence)
CONDITIONS:
1. Consideration of this application will be conditional on the applicant's information which must satisfy the Authority that the applicant is capable of complying with Kenya Standard Code of Practice and any other legal requirements.
2. The dealer shall produce such documentary evidence as requested to support the statements made above.
3. Should the Authority wish to restrict the quantity and quality of coconuts to be marketed, it shall be empowered to do so by giving the dealer written notice of such restriction.
4. A dealer shall pay all dues to the Authority before his application can be considered.
5. A registration certificate issued under this Order shall be valid for three years from date of issue.
6. The Authority has the right to approve or reject this application. In case of rejection reasons will be given and the applicant can reapply.
I hereby declare that the particulars which I have given are true and accurate to the best of my knowledge and belief.
Date .............................................                                    .............................................
Signature
Approval by Kenya Coconut Development Authority
 
Approved/Not approved
 
Signature
Managing Director
 
FORM E (Para. 35(3))
CERTIFICATE OF REGISTRATION OF COCONUT PRODUCE/BY-PRODUCTS DEALERRegistration No. .................................................................Name: ............................................................................Address: .........................................................................L.R. No. .........................................................................Street: ............................................................................Is hereby registered as a dealer of coconut produce/by-products under this Order.The registration expires on ..............................................Date of registration ....................................................Signed ..................................................................Name ...................................................................(Managing Director, Kenya Coconut Development Authority)

SECOND SCHEDULE

FIELD HANDLING AND GRADING MINIMUM REQUIREMENTS

(p. 33(1))
FIELD HANDLING AND GRADING MINIMUM REQUIREMENTS
1.High standards of field hygiene shall be maintained during harvesting operations.2.All harvested produce shall be at the right stage of maturity for intended use.3.Appropriate harvesting equipment shall be used.4.Produce unfit for marketing shall be separated from marketable produce at the field level.5.All produce shall be sorted and graded as appropriate.6.Physical handling of produce shall be minimized at all stages.7.A collection shed shall be constructed for receiving produce at field level.8.The collection shed shall—(a)be accessible to both buyers and farmers;(b)be designed to allow for a store, an office and working area;(c)floors, doors and wall surfaces that shall be made of impervious, non-toxic, washable materials, which are easy to clean and disinfect;(d)constructed to allow for adequate ventilation, lighting, effective produce inspection and made of acceptable materials;(e)have potable water and adequate toilet facilities;(f)have waste disposal facilities;(g)have clear documentation procedures and document control systems.

THIRD SCHEDULE [p. 33(1)]

MINIMUM CONDITIONS APPLICABLE TO PACK HOUSES PRODUCE HANDLING FACILITY

1.Each produce handling facility location shall consider the following catchment area, market or point of exit, access road, room for expansion, ease of labour access and security.2.All processing and packaging must be carried out in a clean, hygienic and safe conditions as set out under the provisions of the Public Health Act (Cap. 242) and the Occupational Safety and Health Act (Cap. 236A).3.The working areas and premises shall be kept free of waste materials.4.Any person in the produce handling facility shall wear protective clothing at all times.5.All hand used equipment and grading tables shall be rust proof and easily cleaned.6.The floor layout shall allow for smooth flow of produce with adequate separation of raw material and finished products.7.The floors, doors and wall surfaces shall be made of impervious, non-absorbent, non-toxic, washable materials which are easy to clean and disinfect.8.The produce handling facility shall have adequate ventilation, temperature control and lighting.9.All machinery used in the produce handling facility shall conform to the provisions of the Occupational Safety and Health Act (Cap. 236A).10.The produce handling facility shall be designed and constructed to prevent entry of domestic animals, rodents, insects, birds, dust and any other unwanted animals.11.Prominent signs shall be displayed forbidding smoking, eating or drinking within the facility.12.All packaging materials shall be kept off the floor in clean dry storage areas free from risk of contamination.13.All produce shall move through the facility operation in the order that it is received, first in first out.14.The traceability of all produce shall be documented throughout the process chain.

FOURTH SCHEDULE [p. 33(3)]

PACKAGING, TRANSPORTATION AND STORAGE MINIMUM REQUIREMENTS

1.The packaging shall protect the produce from mechanical and physiological damages to minimise loss of quality.2.The packaging shall be designed to suit the transport handling system and have capacity to meet market requirements.3.The packaging materials used shall be able to contain the produce, enabling the required quantity to be handled as one unit.4.Coconut produce and by-products shall during storage and transport be kept at the prescribed temperature and humidity levels for each consignment.5.Coconut produce and by-products shall not be stored or transported together with other produce which may contaminate them or otherwise adversely affect their quality.6.Vehicles for transport shall be built and equipped to ensure maintenance of optimum temperatures to prevent damage and spoilage of produce and by-products.

FIFTH SCHEDULE [p. 36(1)]

GUIDELINES FOR CONTRACTUAL AGREEMENT BETWEEN THE PRODUCER AND DEALER IN THE INDUSTRY

CONTRACT FORMAT
PRODUCER/ DEALER AGREEMENT
AGREEMENT made this.................. day of................. two thousand and..................BETWEEN:............................................................. of ......................................... a registered dealer (Registration No. ...............) hereinafter called “dealer” which expression shall where the context so admits include its successors and assignees of the first part;AND............................. of ...................... a producer entity of horticultural produce (Registration No. ..........) hereinafter called the “producer” which expression shall where the context so admits include its successors and assignees) of the second part.WHEREAS(a)the dealer is duly registered under this Order; and(b)the producer has requested the dealer to provide services referred to below and the dealer has agreed to provide such services to the producer upon the terms and conditions appearing hereinafter.
NOW IT IS HEREBY AGREED BETWEEN THE PARTIES AS UNDER THE FOLLOWING GUIDELINES:
AIMS AND OBJECTIVES OF CONTRACTS
The guidelines shall—(i)act as a memorandum of understanding between the producer and dealer of coconut produce;(ii)serve as a guideline for the producer and dealer in order to conduct good business practices, which will be mutually beneficial, and help promote the well-being of the coconut industry in Kenya;(iii)act as guideline or framework for development of a legally binding contract to be executed by the producer and dealer.
OBLIGATIONS OF THE PRODUCER AND DEALER
(a)The producer shall—(i)be organized into well-managed registered legal entities;(ii)relate to specific dealers only under a contract as specified in this Order;(iii)request for training on any aspect that deals with quality control as need arises including—– safe and effective use of pesticides;– proper record keeping and analysis of production costs;– proper post-harvest handling techniques;– group leadership, management and administration;– procurement and use of appropriate certified inputs;– production technology.(b)The dealer shall—(i)relate to specific producer entities under contract as specified in this Order;(ii)provide the necessary extension services to the producer(s);(iii)relate directly with the producer;(iv)establish means and ways of financing the producer.(c)All parties to the contract shall—(i)undertake to conduct their business diligently and professionally at all times;(ii)submit agreement to the Authority for vetting/witnessing before execution;(iii)seek for arbitration in the event that there is a contravention of contract obligation;
TERMS AND CONDITIONS
The contract shall include specific terms and conditions of payment, responsibilities for production, handling and collection of produce, and any other essential elements, which will create a clear understanding of obligations of both the producer and the dealer.
THE ESSENTIAL ELEMENTS THAT A CONTRACT SHALL HAVE, INCLUDE—
(a)Quantity and quality of produce to be supplied at a particular time and contract price(i)The contract shall specify the quantity in either boxes/cartons/crates or kilos to be supplied by the producer(s) over a period of time.(ii)The contract should specify a minimum quantity of produce to be provided by the dealer (i.e. the quantity below which no collection will be effected).(iii)The producer and dealer shall agree to produce and market high quality levels of produce and this shall be specified clearly in the contract.(b)Seed and other inputs(i)The contract shall specify who is responsible for inputs, including labour.(ii)If the buyer requires the use of approved seeds/planting materials by the seller, it shall be specified in the contract.(iii)The contract shall address which party will be responsible for supplying and applying other inputs such as fertilizer and pesticides.(iv)Terms and conditions for purchase or sale of inputs must be included within the contract.(c)Generally accepted production practices Growers shall agree to undertake good agricultural practices and procedures.(d)Record keeping(i)Each grower and buyer shall implement a complete record keeping system for production and handling of produce.(ii)Minimum record keeping requirements for traceability and accountability shall include—– identification of previous crop;– date of planting;– application of pest control products: date, rate, weather conditions;– irrigation dates and quantities;– harvesting: dates and weather conditions.(e)Field support and training(i)Every dealer shall provide the contracted producer with sufficient training during the contract period on—– Group management and administration;– Good Agricultural Practices.(f)Harvesting and post-harvest practices(i)Seller shall agree to undertake acceptable management practices for the harvesting and handling of produce, which will ensure high quality levels.(ii)These practices include—– the use of clean containers away from heat and direct sunlight;– protection of produce from heat and direct sunlight;– the use of clean water for washing of produce where necessary.(g)Inspection and gradingDealer and producer shall agree on and specify responsibilities for inspection and grading of produce, type of document to be executed upon collection/ delivery of produce, agree at what stage goods change title and obligations of each party.(h)Packaging supply and procedures(i)The contract shall specify which party is obligated to supply packaging materials.(ii)The contract shall specify packaging procedures such as condition and quantity of produce, grade and type of produce, and placement within a container.(i)Conditions of collection and/or delivery(i)The contract shall specify the collection periods of produce (time and year).(ii)The contract shall specify conditions for the events of non-collection.(iii)If the dealer fails to collect at specified time, he shall be obliged to pay the contracted price for that produce.(iv)Any produce which the dealer has accepted delivery of shall not be returned to the producer.(j)Rejected produce(i)The point of rejection of produce shall be specified upon in the contract.(ii)Conditions for the return of the rejected produce shall be specified.(iii)Disposal of rejected produce shall be specified.(iv)Any produce which the dealer has accepted delivery of shall not be returned to the producer.(k)Payment terms and mechanismProducer and dealer shall specify the mode, terms and mechanism of payment.
   
   
(l)PenaltiesThe contract agreement shall specify penalties including type and amount of compensation to either party as a result of failure to abide by the terms of the contract.(m)Termination clause(i)The conditions for termination of the contract shall be specified.(ii)Either party may terminate the contract by giving the other a written notice within a reasonable period equivalent to a full production and marketing cycle of the produce.(n)Natural calamities and non-commercial risks (force majeure)(i)In the event of natural calamities (such as floods, hail, earthquakes, etc.) it shall be stated clearly in the contract that both parties shall not be held responsible.(ii)Furthermore, in the event of non-commercial risks (such as war, national labour strikes, etc.) the affected party shall be held harmless for non-performance.IN WITNESS WHEREOF the parties have hereunto executed this agreement on the day and date hereinbefore mentioned.SIGNED for and on behalf of the
Dealer Producer
 
Name: ................................. Name: .....................................
Date: .................................... Date: ....................................
   
Witness: .............................. Witness: ...............................
Date: .................................... Date: ....................................
   
Witness: ......................KCDA Witness: ........................KCDA
Date: Date:
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Cited documents 3

Legislation 3
  1. Environmental Management and Co-ordination Act
  2. Pest Control Products Act
  3. Public Health Act

Documents citing this one 0