Green Leaf Supply Agreement (GLSA)

Green leaf supply agreements are the forms the farmers sign as per the requirements by the law in the Crops Act & Tea Directorate Regulations 2008 & 2013. The agreement defines the relationship between farmers and the factories. The agreement does not harm the farmers and it is a mandatory requirement of the law.

In particular, the Crops Act and the Tea Directorate Regulations of 2008 (and its subsequent amendments) provides that all farmers shall enter into a Green Leaf Supply Agreement with their respective factories as a condition precedent to tea collection and sale.

The factories also cannot collect green leaf from farmers in absence of the Green Leaf Supply Agreement as this would amount to a violation of express provisions of the law.

The Crops Act part 3 provides for the registration requirements for scheduled crops with the pertinent provisions being section 14 (1) stating that ‘Every smallholder grower, for the purpose of accessing economies of scale, shall have freedom; (b) in the case of a tea grower, register with the tea factory to which the person delivers green leaf, by supplying such particulars as the Authority (the Agriculture, Fisheries and Food Authority) may, by regulations, prescribe.’

The Tea Directorate Regulation 2013 section 11 (6) provides that ‘The factory is required to maintain records and particulars of all registered growers’ and section 11 (8) provides that ‘It is an offence for any grower to carry on the business of a grower without being registered.’

In conclusion, KTDA is right in requiring farmers to sign the said the said agreement as required by the above mentioned provisions of the law. This will enhance the relationship between the factories and its share holders.