Grape Purchase Agreements
Grape purchase agreements are central to your business sustainability. WGCSA provides a number of resources and links to help you ensure that you have the best possible agreement in place with a reliable supplier and that you know your rights and the options available to you if things do go wrong.
Grape Payment Regulations
Payment for grapes in South Australia is controlled by an Act. All payments are required to be completed by 30 September each year. It is illegal for a winery to accept winegrapes while still owing money for grapes supplied in previous years.
In SA the Wine Grapes Industry Act gives the Minister power to determine when payments for grapes are to be made. This is done by Ministerial Order. The Order states that three payments are to be made with the final payment to be made by 30 September in the same year as the grapes were harvested.
Having trouble getting paid?
See our tips for recovering late payments.
Please contact us if you have had a bad experience with receiving grape payments or are still owed money outside the legal timeframe
What the Act says
If the processor does not pay by the due date the Act has provisions to assist a grape grower to take civil action to recover unpaid money. If final payments are not made by 30 September, the grape grower is entitled to interest on any outstanding monies. The interest rate is equal to the Commonwealth Bank standard overdraft interest rate as at 1 September plus a 1% penalty. The penalty increases to 5% for payments still outstanding after 31 December.
Some grape contracts have different terms; these are in breach of the Act if they are less advantageous to a grape grower than provided by the Wine Grapes Industry Act, even if you have signed the contract.
Section 9 of the Act states that a processor must not accept delivery of wine grapes for processing unless ‘all amounts that have previously fallen due for payment by the processor for wine grapes received by the processor, or any person acting on the processor’s behalf, in a previous season have been paid in full’.
A breach of this section of the Act is an offence and can incur a fine of up to $8,000 and/or prison for up to two years (as well of course as orders to make good the outstanding money). Being an offence means that the Minister has the power to authorise an investigation and subsequent prosecution.
Wine Industry Code of Conduct
Tips for recovering payments
Personal Property Security Register (PPSR)
A guide to selling wine grapes in SA
This publication contains detailed information on all aspects of negotiating a grape purchase agreement – including preparation, negotiating a contract, contract terms and clauses, handling disputes and what to do if you don’t get paid. Click to download a copy.