Industry collection system
End Point Royalties (EPRs) have been introduced in Australia to reflect the shift from a public funded breeding system to a private system with a number of key organisations.
In 2007 a number of plant breeding organisations formed a group called the EPR Steering Committee, to develop a system for collecting EPRs that is effective and efficient for both growers and the grains industry. Support from both parties has been vital to the development of the EPR industry collection system, whereby the grain traders play a role in the collection of royalties. Participating grain traders either deduct the royalty amount from the grower’s grain payment and remit the royalty directly to the variety owner; or compile reports on grain purchases, which assist the variety owner to correctly invoice the grower for any outstanding royalties owing.
The number of grain traders who are participating in this system has dramatically increased, and continues to grow into the future as industry and growers demand greater efficiency and simplicity of the royalty collection mechanism. EPRs help to create a path to market for new varieties and technologies, which will lead to long term productivity gains for Australian farmers and the broader grain industry.
It is likely that private organisations will fund all future breeding programs, and EPRs will play the major role in supporting these programs. A list of the current key participating grain traders can be found in the Participants section.
Compliance with the End Point Royalty Collection System
Grower compliance with EPR collection is vital to ensure quality new varieties continue to be introduced into the Australian grains market – ensuring long term productivity gains.
If EPR regulations are not maintained, consequences could include;
- Lower than expected returns to plant breeders
- Less resources for plant breeders to develop new varieties
- Fewer breeding organizations and thus less competition
- Effects on productivity to farmers with fewer quality varieties being commercialized
Variety Owners and Royalty Managers use a number of different sources to monitor EPR compliance, however ultimately rely on the farmer to maintain the integrity of the collection system.
Harvest Declaration Forms
Farmers who have purchased an EPR variety will be asked to complete a Harvest Declaration form to assist Royalty Managers with their EPR reconciliation process. This is usually completed between February and May following the cropping season. A number of Royalty Managers are working together to minimize paperwork for growers by capturing variety production information on a single form.
Bulk Handler Reports
A number of Bulk Handlers are providing Royalty Managers with a report showing sales for a relevant variety. This report may be used to invoice growers in the case where EPRs have not been automatically deducted by the grain trader
Grain Trader Reports
As outlined above, the majority of major grain traders operating in Australia are collecting EPRs on behalf of Royalty Managers. Participants provide regular reports to Royalty Managers to assist with the reconciliation processes.
A number of grain traders who are not collecting EPRs on the Royalty Manager’s behalf are providing data reports on their grain purchases, which may be used to invoice growers.