The agreement stipulates that the Co-Packer acts as an independent contractor and that all co-packers who provide co-packing services to the customer are considered co-packer employees. It should also include a clause stipulating that the Co-Packer is responsible for paying its own taxes for fees received in connection with the service contract. Intellectual property – A good confidentiality agreement can properly protect your business secrets at the beginning of the relationship. Before manufacturing, it is not uncommon for product formulas to be modified to accommodate the copacker`s equipment and personnel. Formula changes can be « assigned » to the distributor in a copacker agreement if they are minor. If the formula changes are more substantial, it may be advisable to enter into a product development agreement before the copacker agreement. Non-compete clauses or non-circumvention clauses may complement these agreements in order to continue to protect the distributor from commercial interference. In addition, the agreement should determine whether the customer can enter the co-packer`s premises to verify the methods and conditions of the co-packing as well as the quality of the packaged products. The agreement may also provide for the client or an external audit firm to conduct an annual audit of the co-packer. From a pure point of view, a co-packer contract is a big investment. The agreement allows the distributor to reliably access a production site. There is also a huge added value for a co-packaging agreement – the exercise of discussion and the development of a co-packing agreement with a lawyer is a detailed diagnostic tool to determine the overall health of a food company.
The Code of Conduct sets out expectations and requirements as to how the co-packer should manage its activities with respect to compliance with laws and regulations, ethical standards, social and working conditions and environmental protection. Among the principles outlined in the Code of Conduct are compliance with local and international laws and regulations, corruption, corruption, free competition, child labour, fair compensation and working time, non-discrimination, harassment, health and safety, working conditions, use of natural resources, and waste and emissions.