PACA provides a forum where firms that buy and sell fruits and vegetables can settle commercial disputes outside of the civil court system through:
Informal complaint - if your firm is involved in a dispute, you can file at an informal reparation complaint with any PACA regional office. The complaint must be in writing, accompanied by the current $100 filing fee before a reparation complaint case can be opened. Download an informal complaint worksheet.
Mediation - disputes can sometimes be resolved quickly without the need for an attorney or a collection agency. Our staff is trained to help you resolve contract disputes and preserve business relationships.
Formal complaint - in the event informal efforts fail to settle the claim, the complaining firm can file a formal reparation complaint which could result in an order issued by USDA for payment.
For us to handle a formal reparation complaint:
- The document must be notarized;
- Submitted in triplicate; and
- Accompanied by a $500 handling fee. Note: The handling fee is recoverable to the complainant if the respondent is found to have violated the PACA.
We have provided a Formal Complaint Sample
Bond Requirements - Foreign nationals must also post either a surety bond or a cash surety bond for double the amount of the claim in the formal complaint. The bond must be submitted along with the formal complaint and the filing fee. We have provided a sample bond form and a Sample Nonresident– Cash Surety Bond Agreement to assist you in this process.
Mediation is a voluntary, confidential process in which a trained, impartial person helps people examine their disagreement, identify and consider options and carefully consider possible resolutions. A mediator has no decision-making authority. Unlike a judge or an arbitrator, a mediator does not decide what is “right” or force a decision on either party.
PACA provides a neutral setting with a trained PACA mediator who helps the parties work out a solution that meets the interests of both sides. Each party is given the opportunity to explain his/her point of view, what the dispute is about, what the issues are, and how he/she would like to see the situation resolved. After each side has presented information, the mediator clarifies the issues in neutral language that focuses on the issues, not the people involved. The process promotes calm and rational discussion in order to identify goals and construct a plan that will benefit all parties.
The mediation process provides a non-threatening, informal procedure as an initial step in resolving conflicts. Mediation provides the following benefits:
- Participants control the outcome
- Mediation is forward-looking
- Mediation can preserve and strengthen business relationships
- Mediation is creative
- Mediation is confidential
- Mediation can be fast
- Mediation is likely to be successful