CONSOLIDATED NEWFOUNDLAND REGULATION 1189/96

Short title

1. This Order may be cited as the Fluid Milk Quota Allocation Order.

64/92 s1

Definitions

2. In this Order

(a) "Act" means the Natural Products Marketing Act;

(b) "agricultural management area" means the agricultural management areas established by the Newfoundland Milk Marketing Scheme;

(d) "approved applicant" means

(i) an approved new applicant, or

(ii) an approved old applicant;

(e) "approved new applicant" means a new applicant whose application to the board for the allocation of available fluid milk quota has been approved in principle, but who is not yet a new entrant, or an approved old applicant;

(f) "approved old applicant" means a person other than an existing producer whose application to the board for the allocation of available fluid milk quota was approved in principle by the board under its former policy on or before September 13, 1988 and who had not yet been allocated a fluid milk quota before November 10, 1989 and who is not a new entrant;

(g) "board" means the Newfoundland Milk Marketing Board as established by the Newfoundland Milk Marketing Scheme;

(h) "catastrophe" means a situation which occurs suddenly affecting a dairy farm unit of a registered producer and over which the registered producer has little or no control and which affects his or her production to the extent of creating a reduction in his or her quota under section 14 and includes

(i) severe illness or death for the registered producer,

(ii) sudden death or loss of a significant portion of the registered producer's producing herd of cows,

(iii) destruction of the registered producer's production facilities,

(iv) severe infections of an uncontrollable disease affecting a significant part of the registered producer's producing herd of cows, or

(v) a disease which requires slaughter by health authorities of a significant part of the registered producer's producing herd of cows;

(i) "Category 'A' registered producers" means existing producers whose fluid milk quotas are each less than 1,000 litres of fluid milk per day, and those persons who are new entrants;

(j) "Category 'B' registered producers" means existing producers whose fluid milk quotas each are equal to or greater than 1,000 litres of fluid milk per day;

(k) "dairy farm unit" means a dairy farm enterprise including land, buildings, dairy and farm equipment and livestock including cows or parts of those things necessary for the dairy operation and operated by a registered producer;

(l) "dairy quota allocation committee" means the committee appointed by the board under section 8;

(m) "dairy region" means the following regions:

(i) the eastern region comprised of Agricultural Management Areas 1 to 4,

(ii) the central region comprised of Agricultural Management Areas 5 to 8, and

(iii) the western region comprised of Agricultural Management Areas 9 to 14;

(n) "existing producer" means

(i) a registered producer licensed under the Newfoundland Milk Marketing Board Licensing Regulations who is in good standing with the board as of the date of the commencement of this Order, and

(ii) in the event a registered producer becomes licensed by the board for the first time as a registered producer after the commencement of this Order, the registered producer who has been producing and shipping milk for 2 years or more;

(o) "fluid milk" means milk that is produced by a fluid milk producer for the purpose of shipment to a registered processor for processing and sale in the fluid milk market in the province;

(p) "fluid milk producer" means a registered producer who is either an existing producer or a new entrant and to whom a fluid milk quota has been allocated by the board;

(q) "fluid milk quota" means the quota fixed and allocated by the board to a fluid milk producer representing the quota in litres of fluid milk per day which he or she shall produce and market during the calendar year for which it was fixed and allocated;

(r) "industrial milk" means all fluid milk produced and shipped by registered producers which are in excess of the requirements of the fluid milk market in the province;

(s) "licence" means a licence issued by the board either to a registered producer, a registered processor, a registered transporter or a registered distributor in accordance with the Newfoundland Milk Marketing Board Licensing Regulations;

(t) "maximum fluid milk quota" shall have the meaning assigned to it by section 13;

(u) "milk" means all classes and grades of cow's fluid milk whether whole, reduced or flavoured and includes buttermilk, cream, all classes and grades of reconstituted milk and ultra‑high temperature ("UHT") milk;

(v) "new applicant" means a person who has made application to the board for the allocation to him or her of available fluid milk quota but whose application has not yet been approved in principle by the board;

(w) "new entrant" means an approved applicant who has been allocated a fluid milk quota by the board;

(x) "order" means an order made by the board;

(y) "penalty order" means the Fluid Milk Penalty Order;

(z) "production" means the quantity in litres of fluid milk per day produced by a registered producer on the farm which is sold and delivered to a registered processor or to the board;

(aa) "quarter" means a fiscal quarter‑year of the board as determined by the board;

(bb) "registered processor" means a processor who has been issued a licence by the board under the Newfoundland Milk Marketing Board Licensing Regulations and is in good standing with the board;

(cc) "registered producer" means a producer who has been issued a licence by the board under the Newfoundland Milk Marketing Board Licensing Regulations and is in good standing with the board; and

(dd) "regular and consistent fluid milk production" means production by a registered producer of fluid milk in quantities amounting to

(i) not less than 80% and not more than 120% of the monthly equivalent of his or her annual fluid milk quota in every month during the calendar year, and

(ii) not less than 90% of his or her annual fluid milk quota in that year.

64/92 s2; 228/93 s1

Fluid milk quotas

3. (1) Fluid milk quotas are the property of the board and have no monetary value.

(2) Fluid milk quotas shall be fixed and allocated by the board to registered producers and the board shall record the names of the registered producers to whom fluid milk quotas are allocated and the quantity of quota so fixed and allocated to each in the fluid milk quota register as fluid milk quotas are fixed and allocated by it.

(3) Fluid milk quotas are available solely for the use, under the terms and conditions of this Order, by the registered producers to whom they are allocated by the board.

(4) The board shall set out the fluid milk quota allocated to the registered producer in the production licence issued to the registered producer.

(5) The board shall prepare and present to the chairperson of the Agricultural Products Marketing Board annually a list of the names of registered producers showing the fluid milk quotas of each and the annual fluid milk production of each in litres.

(6) A copy of the list referred to in subsection (5) shall be available for inspection by registered producers at the board office.

64/92 s3

Determination of quota compliance

4. In determining whether or not a registered producer has produced and delivered fluid milk in amounts not less than 90% of his or her annual fluid milk quota in that year, the board shall exclude from those calculations a quantity of fluid milk production which exceeded 110% of the quarterly equivalent of his or her annual fluid milk quota in a quarter during the year.

64/92 s2

Self‑sufficiency

5. The board may issue fluid milk quotas to registered producers to maximize the production and processing of fluid milk in the province and to maximize the marketing in the province of fluid milk produced and processed in the province.

64/92 s4

Industrial milk

6. All milk produced by registered producers which is surplus to the requirements of the fluid milk market in the province, as determined by the board in consultation with registered processors, shall be considered as industrial milk.

64/92 s5

Milk prices

7. (1) Registered producers shall be paid for all their sales of milk used in the fluid milk market in the province at the minimum price for fluid milk sales established by the board in its milk prices order.

(2) Registered producers shall be paid for all their sales of industrial milk at the industrial milk price to be determined by the board.

64/92 s6

Dairy quota allocation committee

8. (1) The dairy quota allocation committee shall be constituted before September 1 in every calendar year.

(2) The dairy quota allocation committee shall be comprised of 5 persons consisting of

(a) one person who shall be a member of the board to be elected at a regular meeting of the board from among its directors;

(b) 3 other persons who shall be registered producers, each of whom shall have a dairy farm unit located in a separate dairy region, and who shall not be a registered producer member of the board; and

(c) one other person as a representative of the agriculture branch of the Department of Forest Resources and Agrifoods who shall be appointed by the minister of that department.

(3) The chairperson of the dairy quota allocation committee shall be selected by that committee from among those members of the dairy quota allocation committee set out in paragraphs (2)(a) and (b) and shall be a registered producer.

(4) In the event of a tie vote on a matter, the chairperson shall have a casting vote, in addition to his or her vote as a member of the dairy quota allocation committee.

(5) The dairy quota allocation committee shall have the duty and the authority to make recommendations to the board for determinations to be made by the board in accordance with these regulations.

(6) The report of the dairy quota allocation committee setting out its recommendations to the board shall be provided to all registered producers on an annual basis.

(7) The board shall have the duty and the authority to make final determinations and decisions under this Order.

64/92 s7

Election of producer members

9. (1) The 3 registered producer members referred to in paragraph 8(2)(b) shall be elected for 3 year terms.

(2) Elections shall be staggered for the 3 dairy regions at one year intervals and shall take place at the annual meetings of the Newfoundland Milk Marketing Board.

(3) Registered producers in attendance shall elect them by casting one ballot for a registered producer member to represent the dairy region in which that voting registered producer's dairy farm unit is located.

(4) Commencing in 1992, registered producers

(a) from the eastern dairy region shall elect one registered producer member for 3 years;

(b) from the central dairy region shall elect a registered producer member for 2 years; and

(5) At the conclusion of each of the terms referred to in subsection (3), all subsequent elections shall be for 3 year terms.

64/92 s7

Determination of provincial fluid milk quota

10. (1) After September 1 in every calendar year the dairy quota allocation committee shall make a recommendation to the board as to the provincial fluid milk quota for the following calendar year.

(2) In making this recommendation, the dairy quota allocation committee shall take account of all relevant factors affecting the fluid milk market in the province including the following:

(a) production in the province of fluid milk for the past year;

(b) sales in the province of fluid milk during the past year to consumers, institutions and others;

(c) anticipated demand by registered processors, consumers, institutions and others for the purchase of fluid milk for the following calendar year; and

(d) anticipated production by registered producers for the following calendar year.

(3) The dairy quota allocation committee shall make its recommendation and the board shall determine the provincial fluid milk quota for the following year before December 31 in every calendar year.

(4) The board shall determine the provincial fluid milk quota for the following calendar year, taking consideration of the dairy quota allocation committee's recommendation and other matters that the board may consider appropriate.

64/92 s8

Quota determination and allocation

11. (1) After September 1 in every calendar year the dairy quota allocation committee shall make recommendations to the board for the determination and allocation of fluid milk quotas for every fluid milk producer for the following calendar year.

(2) In making the recommendation, the dairy quota allocation committee shall adjust the fluid milk quota of each existing producer and new entrant for the current year in accordance with the provisions of section 14, if applicable, in order to arrive at a preliminary adjusted fluid milk quota for each existing producer and an adjusted fluid milk quota for each new entrant.

(3) The sum of all the preliminary adjusted fluid milk quotas for existing producers shall be added to the sum of all the adjusted fluid milk quotas for new entrants each of which shall have been determined in accordance with section 15 and adjusted upon application of section 14, if applicable, in order to equal the preliminary adjusted provincial fluid milk quota.

(4) Should the provincial fluid milk quota, as determined in accordance with subsection 10(4), be less than the preliminary adjusted provincial fluid milk quota, that difference shall be used to further adjust, on a proportional basis, the individual fluid milk quotas otherwise to be allocated to all existing producers and new entrants in order that the preliminary adjusted provincial fluid milk quota shall equal the provincial fluid milk quota.

(5) Should the provincial fluid milk quota exceed the provincial preliminary adjusted provincial fluid milk quota, that difference, which shall equal the available provincial fluid milk quota, shall be divided and allocated by the board as follows:

(a) an amount not to exceed 75% of the available provincial fluid milk quota shall be allocated to those Category "A" registered producers who have submitted to the board completed applications using forms prescribed by the board before September 1 of a calendar year requesting the allocation to them of additional fluid milk quota for the following calendar year;

(b) the difference between 75% and the percentage amount of the available provincial fluid milk quota allocated to the Category "A" registered producers under paragraph (a) shall be allocated to approved old applicants and approved new applicants on the basis that each person who has been allocated a fluid milk quota shall be assigned a fluid milk quota in the amount of 1,000 litres per day;

(c) 25% of the available provincial fluid milk quota shall be allocated to Category "B" registered producers who have submitted to the board completed applications using forms prescribed by the board before September 1 of a calendar year requesting the allocation to them of additional fluid milk quota for the following calendar year; and

(d) balances of available provincial fluid milk quotas unallocated in accordance with paragraphs (a), (b) and (c) may be allocated by the board in a manner and to those persons that it may determine in its absolute discretion.

(6) The board, in its absolute discretion, shall determine the allocation of individual portions of the maximum 75% share of the available provincial fluid milk quota individually among some or all of the Category "A" registered producers referred to in paragraph (5)(a).

(7) Should sufficient fluid milk quotas referred to in paragraph (5)(b) not be available from the portion of the available provincial fluid milk quota in order to satisfy all the eligible recipients to the extent of their applications, the board shall allocate fluid milk quotas

(a) first to approved old applicants on a first come, first served basis, with priority assigned according to the dates on which their completed applications were received by the board; and

(b) then to approved new applicants on the same basis.

(8) The board, in its absolute discretion, shall determine the allocation of individual portions of the 25% share of the available provincial fluid milk quota individually among some or all of the Category "B" registered producers referred to in paragraph 5(c).

(9) The following provisions shall apply to applicants referred to in paragraph (5)(a) as Category "A" registered producers and in paragraph (5)(c) as Category "B" registered producers, in order for them to be eligible for the allocation of additional fluid milk quota as set out in those paragraphs:

(a) the applicant shall not have had his or her fluid milk quota reduced by operation of section 14 for the calendar year preceding the effective date of his or her application;

(b) if the applicant had his or her fluid milk quota reduced by operation of section 14 for the calendar year ending one year before the effective date of his or her application, the applicant shall have maintained a minimum of 100% of his or her fluid milk quota for the calendar year immediately preceding the effective date of that application for additional fluid milk quota; and

(c) if the applicant had his or her fluid milk quota reduced by operation of section 14 for the calendar year ended 2 years preceding the effective date of his or her application, the applicant shall have maintained a minimum production of 90% of his or her fluid milk quota for each of the 2 calendar years preceding the effective date of that application for additional fluid milk quota.

64/92 s9; 228/93 s2

Quota increase

12. (1) An existing producer shall be eligible in a year to an allocation of an increase in his or her fluid milk quota if

(a) the provincial fluid milk quota exceeds the provincial preliminary adjusted provincial fluid milk quota as set out in subsection 11(5);

(b) he or she has complied with section 14;

(c) he or she holds a maximum fluid milk quota, then that existing producer shall have obtained special leave from the board before making an application for an increase in the fluid milk quota otherwise allocated to that existing producer;

(d) he or she has completed an application for an increase in the allocation of fluid milk quota in the form prescribed by the board;

(e) he or she has delivered his or her completed application to the board by way of registered mail before September 1 of the calendar year preceding the year in which the proposed increase in fluid milk quota would take effect.

(2) The dairy quota allocation committee shall

(a) review all applications received in accordance with this section from existing producers for increases in the allocation of fluid milk quotas; and

(b) make recommendations to the board based upon the applications and in the event increases in fluid milk quotas are available to be allocated in accordance with section 11.

(3) The board shall

(a) in its absolute discretion determine whether the request for quota increase shall be approved, disallowed, deferred or otherwise disposed of in whole or in part, taking account of the recommendations of the dairy quota allocation committee; and

(b) inform each existing producer of its determination by notice in writing delivered to the existing producer by registered mail.

64/92 s10

Maximum fluid milk quota

13. (1) When a registered producer holds a fluid milk quota of a quantity in excess of 3,000 litres of fluid milk per day, that registered producer is not eligible to apply under section 12 for an increase in the fluid milk quota otherwise allocated to that registered producer without first being granted, upon application in writing, special leave from the board permitting the registered producer to apply for an increase in the fluid milk quota allocated to him or her in excess of the maximum quota referred to in this subsection.

(2) The special leave shall be granted by the board only in special circumstances that may be determined by the board.

(3) The fluid milk quotas allocated by the board to a new entrant, and to an existing producer who has been producing and shipping milk for less than 5 years, under subsections 15(5) and (6) respectively, shall be his or her maximum fluid milk quota for the applicable years.

64/92 s11

Maintenance of production required

14. (1) In order that they may be entitled to retain, in an ensuing year, the fluid milk quota assigned them by the board for the current year, existing producers and new entrants in their second and third year of production who have been allocated fluid milk quotas by the board shall have regular and consistent fluid milk production.

(2) In determining whether or not a registered producer has produced and delivered fluid milk in amounts not less than 90% of his or her annual fluid milk quota in that year, the board shall exclude from those calculations a quantity of fluid milk production which exceeded 110% of the quarterly equivalent of his or her annual fluid milk quota in a quarter during the year.

(3) If an existing producer, or a new entrant in his or her second or third year of production, fails to meet the production and delivery standard set out in subsections (1) and (2),

(a) immediately following the first year of the adverse performance by the existing producer or new entrant, the board shall deliver to the registered producer or new entrant a notice of adverse performance;

(b) for a second consecutive year, the board shall allocate to him or her an annualized fluid milk quota for the following calendar year which shall be equal to the quotient determined by dividing that fluid milk producer's annualized fluid milk quota for the calendar year just ended by the divisor factor of 0.9;

(c) paragraphs (a) and (b) shall apply for the determination of the annualized fluid milk quotas for the fluid milk producers for the calendar year 1992 only;

(d) paragraph (e) shall apply to determination of the annualized fluid milk quotas of fluid milk producers for the calendar years commencing 1993, and for all years after that;

(e) should an existing producer or new entrant experience adverse performance in a year, the board shall allocate to him or her an annualized fluid milk quota for the following calendar year which shall be equal to the quotient determined by dividing that fluid milk producer's annualized fluid milk quota for the calendar year just ended by the divisor factor of 0.9; and

(f) notwithstanding this section, a producer's fluid milk quota shall not be reduced below the amount of 500 litres per day.

(4) An existing producer or new entrant in his or her second or third year of production who experiences adverse performance in a year before 1993 as provided must inform the board by letter in writing delivered to it by registered mail before September 1, in that year, verifying or denying the adverse performance inconsistent with his or her fluid milk quota and subsection (3) and setting out particulars of the reasons and circumstances surrounding the adverse performance.

(5) Whether or not an existing producer or new entrant has achieved satisfactory regularity and consistency of production in accordance with this section shall be a matter for determination by the board based upon accepted dairy agricultural principles and factors.

(6) Notwithstanding another section of this Order, the application of this section may be waived by the board in whole or in part or subject to the conditions that the board may in its absolute discretion determine

(a) if the fluid milk producer satisfies the board that the adverse performance for a calendar year occurred as a result of a catastrophe; or

(b) that the waiver is justifiable and reasonable

(i) on compassionate grounds, or

(ii) for another just and equitable ground.

(7) The board shall have the sole and absolute discretion to determine what circumstances constitute compassionate grounds and other just and equitable grounds referred to in paragraph (6)(b).

(8) Each new entrant shall be exempt from the application of the provisions of this section for his or her first year of production of fluid milk.

(9) The records of the board shall be, in the absence of evidence to the contrary, proof of the performance, production and delivery of fluid milk by every fluid milk producer.

(10) The calculations made by the board shall be, in the absence of evidence to the contrary, proof of determinations made by it under this Order.

64/92 s12

New applicants

15. (1) New applicants may apply to the board for registration as registered producers.

(2) New applicants shall

(a) complete and deliver to the board in writing by registered mail an application in the form and manner prescribed by the board;

(b) submit to the board a proposed 5 year production plan; and

(3) Upon approval by the board of the application for registration as a registered producer submitted by a new applicant, and of his or her proposed 5 year production plan, he or she shall be designated as an approved applicant.

(4) Approved applicants are eligible to be allocated fluid milk quotas by the board upon the recommendation of the dairy quota allocation committee as the quotas become available, that is otherwise provided in this Order.

(5) As fluid milk quotas become available under subsection 11(5), the board may fix and allocate fluid milk quotas to approved applicants and new entrants during each of their initial 2 years of their approved 5 year production plans, which fluid milk quotas shall be 700 litres per day in each case.

(6) When an approved applicant is first allocated a fluid milk quota and is issued a registered producer's licence by the board, he or she becomes a new entrant for the purpose of this Order.

64/92 s13

Restrictions

16. (1) Fluid milk quotas shall not be sold, transferred, assigned or otherwise dealt with by registered producers.

(2) The board may transfer fluid milk quotas or portions of it only in accordance with these provisions.

(3) The board may transfer a fluid milk quota or portions of it from one existing producer to another existing producer in accordance with this section.

(4) The board may transfer that portion of a fluid milk quota which has been fully utilized by the holder of it, or a portion of that quota from a fluid milk producer to another person in the following circumstances:

(a) upon receipt by the board of an application in writing, in a form prescribed by the board, signed by the proposed vendor or lessor and by the proposed purchaser or lessee, requesting that transfer, in the event of either

(i) the sale by the vendor or holder of the transferable fluid milk quota to, and the purchase of the same by, a proposed purchaser, in which event the board may give its approval and consent to the purchase, sale and transfer and cause the transfer to be made, but only when it has received and reviewed to its satisfaction legal documentation to that effect, and provided that a registered secured creditor of the vendor must provide to the board in advance of the transfer by the board its written consent to the proposed transfer, or

(ii) the lease by the lessor or holder of the transferable fluid milk quota to a proposed lessee, in which event the board may make its approval and consent to that transfer and cause a transfer to be made for a period of time that it may in its absolute discretion determine, but only when it has received and reviewed to its satisfaction legal documentation to this effect and provided that a registered secured creditor of the lessor must provide to the board in advance of the transfer by the board, its written consent to the proposed transfer;

(b) upon receipt by the board of an application in writing, in a form prescribed by the board, signed by a fluid milk producer, to designate on the fluid milk quota register of the board and on his or her registered producer's licence the name and address of one secured creditor; and

(c) in the event of a transfer of all or a portion of his or her fluid milk quota under this paragraph, the fluid milk producer holding the same and the proposed transferee shall satisfy the board that the transfer will result in the existence or continuation of a separate dairy farm unit, including land, building, equipment and herd, having a minimum fluid milk quota of 1,000 litres per day and if the applicant wishing to have his or her transferable fluid milk quota transferred has a fluid milk quota of less than 1,000 litres per day, the board may approve the transfer subject to the conditions that it may impose, in exercise of its absolute discretion after satisfying itself that the proposed transfer would be in the best interests of the applicant fluid milk producer, the proposed transferee, the board and the industry.

(5) The applicant shall submit with the application the documentation that the board may require confirming the indebtedness of the applicant to the secured creditor and confirming that security has been provided by the applicant to the secured creditor over his or her dairy farm unit and his or her fluid milk quota.

(6) An approved and recorded designation shall not be removed from the register and licence at the request of the fluid milk producer without the accompanying prior or written consent of the secured creditor.

(7) In the event of enforcement by the secured creditor of its security over the dairy farm unit and the fluid milk quota of the fluid milk producer, and the sale or lease of the same or a portion of it by the secured creditor to a purchaser who is an existing producer, the board may, in its absolute discretion, transfer the fluid milk quota, in respect of which a designation in favour of the secured creditor has been made, to the purchaser or lessee of the dairy farm unit, and fluid milk quota under the terms and conditions that the board may determine, provided that he or she is an existing producer.

64/92 s14; 228/93 s3; 26/95 s1

Fees, charges and levies

17. (1) The board may

(a) prescribe fees, charges and levies to be imposed upon transferors or transferees of fluid milk quota affected by this Order;

(b) require that the fees, charges and levies accompany submission of the application for approval of its transfer of a fluid milk quota; and

(c) impose an additional amount to be paid by the transferor or the transferee for costs incurred by the board in connection with the consideration of the application for the transfer of fluid milk quota.

(2) The board may prescribe other fees, charges and levies to be imposed upon persons affected by this Order and in the amounts that it may determine.

(3) The board may revoke in whole or in part a fluid milk quota which has been allocated to a person for failure to pay penalties, fees, charges or levies imposed by it or under another regulation, order or direction of the board for breach or violation of the provisions of this Order or another regulation, order or direction of the board.

(4) Transfers of fluid milk quotas shall not be made by the board until the time that all debts, penalties, fees, charges, levies and other amounts due to the board by the transferor or by the transferee have been paid in full.

(5) Registered producers shall pay to the board fees, charges and levies imposed under subsections (1) and (2) immediately following the imposition of the fees, charges and levies and the delivery by the board of a notice in writing to the registered producer.

(6) The board may deduct the amounts of the fees, charges and levies by way of set‑off against amounts otherwise payable by the board to registered producers upon whom the fees, charges and levies have been imposed and by whom the fees, charges and levies are payable.

(7) Registered processors shall, on receipt of a demand by notice in writing from the board, deduct the amount of the fees, charges and levies from amounts otherwise payable, or after receipt of the demand becoming payable, by the registered processor to registered producers upon whom the fees, charges and levies have been imposed, and the registered processor shall remit to the board the amount of the fees, charges and levies imposed upon registered producers to the extent immediately upon the making of the deductions.

(8) The receipt by a registered processor of a demand from the board under subsection (7) shall be sufficient and continuing authority to the registered processor to make deductions and to remit the payments as set out in that subsection.

(9) If the fluid milk production by the fluid milk producer or transferor was less than 90% of the fluid milk producer's annual fluid milk quota, the portion of that fluid milk producer's fluid milk quota which is transferable shall be equal to the quotient determined by dividing that fluid milk producer's fluid milk production for the calendar year ending on or before the effective date of the proposed transfer by the divisor factor of 0.9 provided that if the fluid milk producer or transferor has exercised the producer option under section 18 not to have that producer's fluid milk quota reduced under section 14 by reason of adverse performance and provided all fluid milk penalties and other amounts due by that fluid milk producer or transferor to the board have been paid, the portion of the registered producer's fluid milk quota which is transferable shall be equal to the registered producer's fluid milk quota which has been fully utilized.

64/92 s14; 228/93 s3; 73.1/95 s1

Producer option

18. Where in any year a producer's fluid milk quota shall be reduced by application of the provisions of section 14 and during the same year the board shall have imposed upon that registered producer a fluid milk penalty under the penalty order in respect of excess or deficient production, that registered producer shall have the option, to be exercisable by him or her delivering written notice to the board within 30 days following the board sending to that registered producer his or her production statement for the month of December of the year just ended as follows: either

(a) not to have his or her fluid milk quota reduced under section 14 by reason of adverse performance, if that registered producer shall promptly pay to the board all outstanding fluid milk penalties and other debts, penalties, fees, charges, levies and other amounts due to the board by that registered producer; or

(b) to sustain a reduction of that producer's fluid milk quota as a result of the application of the provisions of section 14 by reason of adverse performance during the calendar year just ended, in which latter event and upon receipt of notice from the registered producer that this option has been exercised, the board shall refund to the registered producer amounts of the fluid milk penalties for excess or deficient production paid by that registered producer provided that all other debts, penalties, fees, charges, levies and other amounts due to the board by that registered producer have been paid in full.

228/93 s4; 73.1/95 s1

Repeal

19. The Newfoundland Milk Marketing Board Fluid Milk Quota Allocation Policy Order, Newfoundland Regulation 64/92, is repealed.