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Tea Marketing Control Order amended to address genuine difficulties of buyers/sellers of tea

Date : 24 Apr 2003
Location : New Delhi
 

In order to remove the genuine difficulties of the various sections of the tea industry for the purpose of implementation and compliance of the new order, the Government has since brought about amendments to the TMCO 2003. The main amendments include: -

• Manufacturers who produce hand made tea have been excluded from the definition of the term ‘manufacturer’. In other words, manufacturers, who manufacture tea in a factory, only will come within the purview of the Order.

• Buyers of value added products of tea and secondary buyers who do not source their teas either from auctions or from manufacturers have been excluded from the definition of ‘Buyer’. This will imply that only those primary buyers who are involved in direct purchase of tea either from the auctions or from the manufacturers, tea estates/tea producing companies, bought leaf factories/co-operative factories and against whom delivery orders are made, have to apply for registration.

• Buyers will be required to file only quarterly returns instead of on monthly basis or furnish such other information as the Registering Authority may, by special or general order, call for from time to time.

• Application fees for registration/issue of licence/renewal of licence have been reduced to half of the amount prescribed in the earlier order. Further, only one registration fee would be payable regardless of the number of units for which a manufacturer seeks registration for.

• Registered manufacturers will be able to sell teas outside the public auction system to the registered buyers or through own retail outlets or branches directly to consumers or by way of direct exports.

• For fixation of reasonable price for green leaf payable to small growers, the sale proceeds received by the registered manufacturer will be taken into account. Further, specification of the reasonable price and its implementation will be with the prior approval of the Central Government.

• A specific clause has been incorporated empowering the Registering/Licensing Authority to relax any of the provisions of the TMCO, 2003 with the prior approval of the Central Government, to address any other concerns of the industry in complying with the provisions of this Order.

It may be recalled that concerned with the continuous fall in the auction prices of tea, which have not been reflected in the retail prices of the commodity, the Tea Board at the instance of the Government had commissioned a study of the primary marketing system of tea by M/s. Ferguson & Co. Based on the recommendations of this study, which had a focus on a more transparent price discovery mechanism, Government notified the Tea (Marketing) Control Order 2003 on 1.1.2003 in replacement of the existing TMCO 1984. Directives regarding changes in auction rules have also been issued, as auctions have traditionally been the main platform for primary marketing of tea in India.

Certain provisions of the TMCO 2003 reportedly caused some concern to the buyer community in regard to their implementation especially the provisions relating to definition of buyer/manufacturer, his registration, payment of registration fee, submission of returns etc.

It is hoped that the amendments to TMCO 2003 will help in removing the genuine difficulties faced by the buyers/sellers of tea.

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SB/PM/MRS