Grain dealer licence

A buyer of a grain-handling business should read the licence file early. The Canada Grain Act is federal, and its definition of a grain dealer is a person who, for reward, on their own behalf or another person’s, deals in or handles western grain. Section 42 lists a grain dealer’s licence as a class separate from the primary, terminal and process elevator licences, and s.44 bars carrying on business as a grain dealer without one, except where the business is exempted under s.117 or the person deals in grain only while operating a licensed elevator or as a broker trading on a recognized grain exchange.

Security and renewal

Under s.45 the Commission may, subject to the regulations, fix the security an applicant must give, by bond, suretyship, insurance or otherwise, and may refuse a grain dealer’s licence if the applicant has not given it. Under s.49 it may also order additional security if it has reason to believe and is of the opinion that the security given is not sufficient. The Commission also states that a grain company licence must be renewed each year.

What to ask

• Which class of licence the seller holds and its current renewal status
• What security is in place and who provided it
• What the Commission requires if ownership or the licence details change, since it publishes a page for changes to grain company licences

The farm business due diligence guide covers the wider file; compare farm business registration, which is Ontario’s separate registration.