Essential Components of Fair Trade
Fair trade is an ethical, market-based way to enhance the quality of lives of farmers and other producers and their communities. It requires the adherence to international standards for working conditions and labor safety as well as environmental sustainability. Furthermore, importers and/or processors pay a social premium, most of which is invested into community development projects. The ecological aspects of the standard for agricultural production can be fulfilled almost entirely by certification according to recognized national standards, such as the EEC 834/2007, or the US National Organic Program (NOP). GLOBALGAP certification also covers several core aspects of the same FairTSA standard.
FairTSA Fair Trade Standards
Presently the product specific standards are:
- Agricultural (coffee, tea, sugar, etc.)
- Processed Foods (multi-ingredient)
- Cosmetics (skin care, body care, etc.)
Each FairTSA standard includes a product registry that contains specific product-related requirements that FairTSA management deems necessary (e.g. cocoa bean production in prior rain forest areas). Within these standards there are measurable indicators for product quality, ethical labor, environmental and social conditions, which simplify the verification of adherence to above mentioned standards.
Moreover, the following standards informed the development of FairTSA standards: ISEAL alliance SASA project recommendations, USDA National Organic Program (NOP), the Social Accountability Standard SA 8000, the Fair Trade Labeling Organization and other private Fair Trade Standards. Additional FairTSA standards are currently under development.
General Requirements Specified in FairTSA Standards
The FairTSA Fair Trade Standards are strict and meaningful, but at the same time clear and easily intelligible presented. The general requirements are designed in adherence with ISO 65 and ISO 62 respectively (for the case of producer cooperatives). They regulate the framework of rights and duties of FairTSA, the certifying partners and the FairTSA certified producers and companies.
The complete “chain of custody” of the product from producer to manufacturer has to be inspected to be in compliance with the respective FairTSA standard in order for the FairTSA mark to be licensed to the manufacturer for use on product packaging. Wholesalers that do not manufacture or package products and retailers are excluded from this requirement. The annual certification renewal process facilitates proper control over compliance to the respective FairTSA standard. Certain large Grower Groups may be required to establish an Internal Control System according to the provisions of ISO 62.
A FairTSA Buyers Code of Conduct is specified in all FairTSA standards and includes the following guidelines:
- Buyers are to enter purchasing agreements for FairTSA certified products with the seller in a fair and professional manner with the goal of establishing a long-term but not exclusive relationship.
- All buyers of FairTSA products are encouraged to actively support the establishment of a production-processing-distribution chain which is both socially just and ecologically responsible.
- Advertising and marketing of FairTSA products may not be used to conceal or justify activities: 1) that violate labor laws; 2) that involve unregulated, unpaid or forced child labor; 3) that are unnecessarily detrimental to the environment; or, 4) that are in any other way in contradiction of the FairTSA principles.
- FairTSA as the standard holder has the right to publish the annual percentage of each buyer’s FairTSA-certified product relative to that client’s total annual production of that same product. This percentage-of-volume information allows FairTSA to respond to claims of “fair-washing”.
FairTSA Social Premium and Community Development Service
The Social Premium is completely used for the development, support and documentation of Community Development Projects. For FairTSA, improvement of product quality or competitiveness in the market, such as implementation of improved post harvest treatments (e.g. solar drying equipment for cocoa drying), qualifies for this category as much as improvement of health care or children’s school attendance in the producer’s community. The Community Development program is a direct and participatory approach to supporting development in the producer communities. For the case that such an appropriate project is already in place, FairTSA will support that. If none are in place, this program gives an incentive to start communication between producers and their social surroundings about existing problems and potential solutions.
The projects are supported by FairTSA’s Community Development Support Service (CDSS), a unique and value-adding component to the FairTSA-Certified Fair Trade System. The CDSS hires and provides training for qualified indigenous professionals, who visit community development projects on a regular basis and provide social and technical support to the process.
FairTSA will implement pages on its website that feature the Community Development projects for increased transparency and also for marketing support. The above mentioned CDSS personnel will play an essential role in providing information for the website.
FairTSA inspectors verify the use of the social premium during their annual inspections. In the case that no professional CDSS personnel are available in a certain region, FairTSA reserves the right to let the project be run on the community’s own initiative, without that support, but according to specific FairTSA guidelines. If a buyer, be it an exporter, importer or manufacturer is already providing meaningful Community Development Services before entering an agreement with FairTSA, such Community Development Services can be subtracted from or replace the Social Premium – and sometimes even the Community Development Service fee – if the projects are thoroughly documented and the financial contribution can be quantified.
How to Become a FairTSA Licensee
Step 1 – FairTSA INFORMATION
Please download the Consolidated Standard from our “Services and Standards” web page and the FairTSA Licensee Application below. If you have questions, please contact the FairTSA East Coast Office and we will gladly answer any questions you may have.
Step 2 – PRODUCT DETAILS
If necessary, FairTSA representatives and the interested party meet in a teleconference to share detailed information concerning the product or products, its production, and its “chain of custody.”
Step 3 – LICENSING AGREEMENT
FairTSA sends its Licensing Agreement to the interested party. If necessary, a phone call or a meeting will be scheduled to walk the client through the contract and explain the terms. Once the terms are agreed upon, a FairTSA officer and an officer of the client company signs the Licensing Agreement.
Step 4 – LICENSING MARK GRANTED
With the signing of the Licensing Agreement the licensee can now use the FairTSA mark on products produced and processed by a FairTSA certified producer or processor. A labeling guide is provided and the respective graphic file(s) are made accessible. A press release is crafted, and authorized by both parties for publication. Simple sales reports and licensing fees are due on a quarterly basis.
The FairTSA Engagement Process For Production Partners
Step 1 – FairTSA INFORMATION
FairTSA or a cooperating certifier will send an information package to an interested producer or processor. The information package and subsequent calls emphasize that the whole chain of custody need to be certified.
Step 2 – INSPECTION AND CERTIFICATION
The respective certification agent sends a cost estimate to the party that requested certification. A FairTSA-trained inspector conducts the initial inspection of the producer(s) and of the product’s chain of custody if necessary. The inspection reports(s) is/are reviewed and the certification decision is issued. After all applicable fees are paid, the certificate is delivered to the client and a copy sent to the FairTSA office. The inspection and certification process is repeated on an annual basis.
Step 3 – SELLING FairTSA CERTIFIED PRODUCTS
Once the certificate has been issued, the producer or processor may sell FairTSA certified products to FairTSA licensed buyers.
Step 4 – COMMUNITY DEVELOPMENT PROJECTS
A FairTSA CDSS representative will be assigned to define, support, and report on community development projects financed through the Social Premium funds. FairTSA will make regular reports available to the client. The producer community will provide regular reports to FairTSA.
The Certification System
As much as possible FairTSA works in adherence to the ISO 65 guidelines and therefore inspection and certification are conducted by an independent, ISO 65 accredited certification office. The only exceptions are pilot projects, that can be audited directly by FairTSA for up to two years.
Certification agencies have to apply for FairTSA accreditation and agree to allow FairTSA to conduct audits of the certifiers as well as the certified operations’ procedures.
The FairTSA inspection and certification system is designed to be conducted alongside organic certification according to EEC 834/2007, NOP, JAS and other recognized national organic standards. Using this approach inspections can be carried out by the same person at the same time for lower costs and resources. Additionally, FairTSA accepts an organic certification as part of the FairTSA certification since most aspects of the ecological requirements are thereby satisfied.
Relevant parts of other certification programs, such as GlobalGap are accepted as part of FairTSA inspection and certification. Every producer or processor can request FairTSA to accept existing certification programs, which they are involved in.
For all finished products that have been produced and processed under a licensing contract with FairTSA, the use of the FairTSA seal is obligatory. The complete chain of custody from production to processing must be inspected for compliance with the respective FairTSA standard.
An annual renewal process ensures the compliance with the criteria of the FairTSA standard.
FairTSA- Certified Fair Trade™ Mark
Once certification has been successfully completed, the FairTSA Certified Fair Trade™ mark is used on the label in an appropriate size.
Summary of other Requirements for Agricultural Products:
Social development requirements – upholding democratic and participatory principles as much as possible (in the case of cooperatives and grower groups), clear organizational structures, proper use in community development of social premium funds, and the establishment and pursuit of social progress Goals.
Economic development requirements – pertaining to the distribution of the Fair Trade Premium and Social Premium, the maintenance of accounting records, and the establishment and pursuit of economic development goals.
Labor requirements – specifying labor guidelines based on International Labor Organization Conventions, including guidelines concerning child labor, dangerous environments, minimum wages, non-discrimination, employment agreements, trade union membership, occupational health and safety, and the establishment and pursuit of labor-related progress goals.
Environmental and agricultural production requirements – requiring the development of a FairTSA System Plan that covers Agricultural Practices, Ecosystem Conservation, and Endangered Species Protection, water use, waste treatment, and guidelines concerning the use of agrochemicals.
- Summary of other requirements for processed food:
- Any FairTSA certified processed must have at least 35% FT certified ingredients (excluding water and salt).
- Processed Foods have to be labeled in accordance with the FairTSA Standard for Processed Foods.
- There are limited inspection requirements for facilities that only distribute, but do not repack or process
- FairTSA has created lists for prohibited processing preservatives and food ingredients that may not be present in FairTSA certified foods.
- The general labor and health and safety requirements have to be observed by all processing facilities.
NOTE: The above summary conveys general concepts. Details are contained in the Standards documents.