Growers’ Agents’ 

Responsibilities Under the PACA

Your crop is harvested and ready to market. 

Getting to this point hasn’t been easy--you’ve 

endured sleepless nights worrying about weather 

conditions, bank loans, and spray schedules. You’ve 

spent thousands of hours working tirelessly to ensure 

that your crop is top quality and will provide the 

best return on your investment. But producing a 

crop is only half the job. The rest involves 

marketing.

Many growers hire sales agents to sell and market 

their crop. Although arrangements vary, agents 

typically receive a percentage of the sales price as 

their commission, and may also be entitled to deduct 

other expenses. In addition to selling the produce, 

agents invoice and collect, deal with customers’ 

claims, contract with carriers, and provide growers 

with a detailed accounting of the sales and expenses 

along with payment of the net proceeds.

These agents perform an important role as the 

marketing link between producers and buyers of 

fruit and vegetables, and must therefore conduct 

their business within certain guidelines. The 

Perishable Agricultural Commodities Act, or 

PACA for short, promotes and enforces fair trading 

practices in the fruit and vegetable industry. The 

PACA requires that growers and their agents live 

up to the terms of their agreements and provides a 

forum that can be used to resolve any disputes that 

may arise.

Written Contracts

The PACA requires that agents outline the duties 

and responsibilities of both parties in writing before 

the first lot is received.

Besides being a legal requirement, written 

agreements just make sense--after all, your entire 

livelihood can be at stake and the terms of your 

agreement should not be dependent upon faulty 

memories. A simple, written contract signed by 

both the grower and agent is the best way to ensure 

that the duties and responsibilities of each are clearly 

defined. Agents may also meet the law’s requirement 

by providing the grower with a written statement of 

company policy prior to receiving the first shipment 

of the grower’s crop. Under the PACA, growers are 

then considered to have agreed to those terms when 

they begin to deliver product to the agent. Either 

way, having the duties and responsibilities of both 

parties in writing reduces misunderstandings and 

allows both parties to build a foundation for a 

long-term, profitable business relationship.

Elements of the Contract

Contracts vary greatly in complexity depending 

upon the nature of the agreement. In some 

instances, the agent does just about everything 

except provide the land on which the product 

is grown. This may include supplying seed and 

financing the planting, harvesting, and packing. 

In other cases, the agent may merely sell the crop, 

invoice the buyers, and deduct a commission. 

Whatever the case, the duties of both parties should 

be clearly spelled out in the contract, along with the 

costs or fees for performing each activity.

Agents can reduce their record-keeping requirements 

by establishing a fixed fee for each function they 

perform. Otherwise, the law requires agents to 

prepare and maintain all records necessary to 

document each expense.

Agents must obtain the grower’s permission to 

carry out certain tasks. For example, an agent must 

secure the grower’s permission if the agent expects to 

consign produce, file carrier claims on the grower’s 

behalf, or use brokers and commission merchants 

(passing the charges for these firms’ services on to 

the grower). If an agent wishes to purchase product 

for his/her own use or plans to sell to a firm owned 

or controlled by the agent, permission must first be 

obtained from the grower – otherwise, such sales 

are forbidden by the PACA. Also, if an agent wants 

to pool and sell produce from several growers, the 

contract should specify the nature of the pool and 

the time periods it will cover.

Contracts should also specify the timing of interim 

and final accountings.

If the agent wants to be able to adjust original 

invoice prices without repeatedly obtaining 

inspections to verify the condition of products at 

destination, the agent must obtain the grower’s 

written consent. Otherwise, the agent must defend 

the grower’s rights by insisting that the buyer pay the 

full invoice price unless the agent can prove a breach 

of contract with a U.S. Department of Agriculture 

inspection.

Records Requirements

Growers’ agents must maintain detailed records 

documenting the disposition of the grower’s product. 

This responsibility includes maintaining a record 

of all product received, issuing delivery receipts, 

assigning lot numbers to differentiate the sales of 

each grower’s product, tracking the disposition of 

culls, and preparing accurate records that reflect the 

proceeds of each sale. If the agent is operating under 

a pool agreement with growers, the accounting 

must show how the pool costs and sales figures 

were calculated. Agents often handle the sales of 

many growers’ crops at the same time. Because of 

this, the PACA requires that they keep detailed and 

precise records to ensure accurate accountings to 
each grower. Since agents sell and receive payment 

for produce on their growers’ behalf, they assume 

important ethical and legal responsibilities and 

must protect the growers’ best interests at all times, 

including the requirement that they preserve the 

growers’ right to trust protection.

Accountings to the Grower

Under the PACA, agents must provide growers 

with prompt, accurate, and detailed accountings. 

Unless the parties contract for other terms, interim 

accountings are due within 30 days from the 

agent’s receipt of the first shipment of produce for 

sale. Thereafter, agents must provide growers with 

accountings every 10 days. The final accounting 

is due within 30 days from the date that the agent 

receives the last shipment for the season.

Agents are not expected to guarantee returns, and 

are not required to pay the grower until they have 

received payment from the buyer. However, if 

the agent guarantees payment or is negligent in 

extending credit, the agent may be held liable for 

payment to the grower. An agent must, therefore, 

put the grower’s interests first when selling the 

grower’s produce.

When Disputes Arise

What should you do if you question whether an 

agent has handled your crop properly or has paid 

you the correct amount due? If you believe your 

sales agent has not met his/her responsibilities, 

you should speak to a PACA specialist (telephone 

numbers are noted below). If necessary, you may 

file a claim against the agent with the PACA Branch. 

When the PACA Branch receives your claim, we 

gather all the relevant information from both parties 

involved and offer our assistance in resolving the 

matter. In some instances, a PACA representative 

may have to audit the agent’s records to determine 

whether additional proceeds are due.

The PACA Branch also offers mediation services 

to help agents and growers to settle disputes. 

Mediation is often an effective way to resolve 

disputes, since it places resolution directly in the 

hands of the interested parties. Mediation provides 

an outlet for settling differences outside the legal 

system, strengthens business relationships, and 

provides a forum where both parties can air their 

differences in a neutral atmosphere.

The PACA law is here to ensure fairness 

and offers many services to assist you. 

For additional information, call our 

toll-free number, 800-495-7222, or visit our 

Web site at www.ams.usda.gov/paca.

The U.S. Department of Agriculture (USDA) prohibits discrimination 

in all of its programs and activities on the basis of race, color, national 

origin, age, disability, and where applicable, sex, marital status, familial 

status, parental status, religion, sexual orientation, political beliefs, 

genetic information, reprisal, or because all or part of an individual’s 

income is derived from any public assistance program. (Not all prohibited bases apply to all programs.) Persons with disabilities who require 

alternative means for communication of program information (Braille, 

large print, audiotape, etc.) should contact USDA’s TARGET Center at 

(202) 720-2600 (voice and TDD).

To file a complaint of discrimination, write to USDA, Assistant Secretary 

for Civil Rights, Office of the Assistant Secretary for Civil Rights, 1400 

Independence Avenue, S.W., Stop 9410, Washington, DC 20250-9410, 

or call toll-free at (866) 632-9992 (English) or (800) 877-8339 (TDD) 

or (866) 377-8642 (English Federal-relay) or (800) 845-6136 (Spanish 

Federal-relay). USDA is an equal opportunity provider and employer.

April 2011

United States Department of Agriculture

Agricultural Marketing Service

Growers’ Agents’ 

Responsibilities 

Under the PACA

Growers’ Agents’ 

Responsibilities 

Under the PACA

United States Department of Agriculture

Agricultural Marketing Service