Much like you need a driver’s license to operate a vehicle, the law requires that you have a PACA license to operate a produce business. A PACA license is proof to your customers and suppliers that you are a serious business person who can be trusted to honor the terms of your contracts.

The PACA license is the key to ensuring that traders meet their contractual obligations under the law. Fruit and vegetable buyers and sellers must abide by the fair trading practices established by the PACA or face possible suspension or revocation of their license. This includes meeting contract specifications, paying all contracts promptly, and maintaining trust assets.

A person knowingly operating a produce business without a license may face a monetary penalty of up to $1,200 for each violation and up to $350 for each day the violation(s) continue.

Beyond its value in enforcing the PACA, the license can also provide information about a firm’s type of ownership, business history, and principals.