1. GROUP CERTIFICATION: THE INTERNAL CONTROL SYSTEM Istituto per la Certificazione Etica ed Ambientale

2. Organic certification Rules set by organic movement: IFOAM Rules set by regulations (EU, US, Japan) Each farmer inspected annually by certifier When that is not done: exception  Smallholder Group Certification Using an Internal Control system = ICS

3. Objectives of Group Certification –Reduction of the inspection costs for small operators. –Execution of most inspections by internal inspectors, within the framework of the Internal Control System set up by the group. –Certification of the group as a whole by the external inspection body, after verifying and evaluating the group’s Internal Control System.

4. Smallholder Group Certification ICS is an internal audit, a quality assurance protocol managed by the project operator itself (co-operative, farmer association or exporter). All actors are identified, instructed on the requirements, contracted, inspected and if needed sanctioned by the operator itself. The external certification body evaluates whether the internal audit functions well, based on file review and risk assessment and does a number of re-inspections. ICS combined with extension, research, other quality management functions.

5. ICS Definition: “An Internal Control System is a documented quality assurance system that allows the external certification body to delegate the annual inspection of individual group members to an identified body/unit within the certified operator. (As a consequence, the main task of the certification body is to evaluate the proper working of the ICS.)”

6. Internal Control System A documented quality system whereby the Exporter/Group takes the responsibility of ensuring that the produce is organic. The certifiers role is verify the ICS and its implementation. This means that –The certifier will inspect a percentage of farmers (normally the square root of the number of farmers) –They will check buying records, documentation etc.. –They are inspecting the system not the individual farmers –Failure in one area means failure of the group as a whole.

7. The Group By small operators we mean farmers, tenant farmers or harvesters who perform their activity mainly through their own work or with the help of their family. The operators in the group shall apply similar production systems and their production units shall be located in homogeneous areas. By way of an exception, also the operators managing larger holdings may be accepted into the group, provided that the external certification costs do not exceed 2% of their turnover.

8. Caracteristics of the Group The group shall be organized as a co-operative or an association, or shall be affiliated to a processor or an exporter. The group shall be established formally, based on written agreements with each one of its members. It shall have central management, established decision procedures and legal capacity. The size of the group shall be sufficient to support a viable Internal Control System and a coordinated marketing or exporting as a group. The certified entity shall be the group as a whole; this means that individual operators may not use the certification independently (by marketing as individual producers outside of the group).

9. Group requirements democratic The organization shall have a democratic structure. This means that: membership must not be discriminated on the basis of race, colour, sex, religion, political opinion, national extraction or social origin; there is a General Assembly with voting rights for all members; each member has one vote within the General Assembly; the General Assembly is the supreme decision-making body; all elective boards and positions are elected in the General Assembly; the General Assembly is formally held at least once a year; the annual budget and balance are presented to and approved by the General Assembly.

10. What is a smallholder? A farmer in a group certification scheme is considered a smallholder when her/his holding meets at least 6 of the 8 following criteria: Low-tech production system Based on family labour Limited capacity of marketing on his/her own Limited capacity of farm administration Limited capacity of communication in the language of the certifier Limited capacity of storage / processing The average annual income from the certified product is below approximately 5,000 US$ taken over a number of years (eg 5years). Would spend over 2% of commodity export value on external inspection when not certified in a group. Also taken over a number of years (eg. 5 years).

11. Internal Inspectors Internal inspectors are appointed by the Small Operators Group and carry out internal inspections. They must have received suitable training in organic agriculture and the conduct of internal inspections. Training activities for all inspectors shall be documented. Inspectors shall have available clear job descriptions specifying their duties and responsibilities. The Internal Control System shall have effective rules to prevent or limit potential conflicts of interests of the internal inspectors.

12. ICS table of contents Description of project, farmer and farm practices Description of production and processing Organisation Risk assessment Maps Procedures Documentation & record keeping

13. Required documentation Buying procedures Buying record Contract for processing unit Contract for organic project staff Farm entrance form Farm inspection form Growers’ contract Growers’ list Internal organic standard Irregularity delivery form List of Internal Inspectors Organisation chart Storage and handling procedures Village map