Frequently asked questions and answers

15 March 2023

The General Binding Declaration (GBD) is a new collection model for the Flower Council of Holland’s collective activities. The GBD will not be entirely new to the horticulture sector. Collective research is also funded via a GBD.
This no doubt raises a few questions. The frequently asked questions and accompanying answers have been listed below.

QUESTIONS AND ANSWERS ABOUT:

Added value and the future of the Flower Council of Holland

What does the Flower Council of Holland for me? >>The Flower Council of Holland is there on behalf of, for and by all entrepreneurs in the sector. As an independent organisation, we have been proudly promoting flowers and plants grown or traded by the Netherlands for over 40 years now. Our European activities and research have given us a keen insight into consumers, and their behaviour and preferences. We use this insight and knowledge to communicate about flowers and plants, and to inform growers and traders.
What else will the Flower Council of Holland do for me in the future? >>This has been set out in our 6-point plan:

We will start with sector-related consumer communicationWe will develop and spread the stories behind our products. Stories that enhance the positive image of the sector.

We will continue to actively launch high-profile consumer campaigns, inspirational content and shopper marketing.

We will appeal to a wider group of consumers.

We will also take advantage of opportunities beyond our four key countries (Germany, France, United Kingdom, the Netherlands).

We will actively seek partnerships with entrepreneurs and organisations.

We will intensify consumer research, share knowledge and insights, and help entrepreneurs to implement them.
Why is it important for the Flower Council of Holland continue to exist >>As part of its independent role, the Flower Council has been responsible for generic consumer communication about flowers and plants in Europe for the past four decades. It has thus played an important role in boosting the sale of flowers and plants. For example, 77% of consumers in the main buyer groups state that they were prompted to buy more flowers by the ‘We Need More Flowers’ campaign. It is paramount for the sector as a whole for these collective promotional efforts to continue.

A new collection model: the GBD

What is the current collection model? >>Payment for the Flower Council of Holland activities is currently collected from domestic and international growers who are members of Royal FloraHolland (RFH), and from growers and trading companies that conduct transactions via RFH. A small percentage (0.2% of growers’ product sales and a graduated scale from 0.19% to 0.06% on traders’ product sales) is collected and used by the Flower Council for our collective communication on behalf of the sector. As not all growers are members of the auction company, and not all traders purchase through the auction company, not everyone contributes proportionally to our collective communication. That is why Royal FloraHolland will stop collecting for our activities as of 1 January 2024.
What will be changing? >>As not all growers are members of the auction company, and not all traders purchase through the auction company, not everyone contributes to our collective communication. That is why Royal FloraHolland will stop collecting for our activities as of 1 January 2024.
The Flower Council of Holland is there for all entrepreneurs in the sector. Collective communication calls for a collective collection model in the sector. Everyone will benefit and everyone will contribute, so there will be no more free riders. One way of organising this is a General Binding Declaration (GBD). The GBD is an appropriate, tried-and-tested collection method. A GBD will help the collective to grow and prosper. Nonetheless, we will only introduce the GBD if the sector supports this approach.
What is a GBD? >>GBD stands for General Binding Declaration. It is a proven and effective measure organised by the Dutch government, which will enable us to control collections from the entire horticulture sector in a fair manner. A GBD has already been successfully introduced in our sector, namely the one for collective research, which gave rise to initiatives such as the ‘Knowledge in your Greenhouse’ Research and Innovation programme.
A GBD can only be requested for if there is enough support within the horticulture sector. In order to gauge whether there is indeed enough support, the sector will be asked to express its views in an online survey (from 27 March to 7 April 2023). Your company’s director, director-owner or major shareholder will be eligible to vote.
Will all product groups be taking part? >>The GBD application will be made for the product groups cut flowers and house plants. This will not be done for trees, shrubs, garden plants and bedding plants, which formally make up one category together. This category contains many growers of trees (including avenue trees) and perennials. Only part of this product group is currently sold via auctions and many growers do not sell directly to consumers. That is why this group currently falls outside the scope of the application.
Does this mean that the garden plants category is not included but will still benefit?No, because the campaigns and communication will focus on cut flowers and house plants. If any voluntary contributions are made, such as for Outdoor Plants, then specific campaigns will be developed with separate budgets.
What will change in terms of the collected amount >>No changes will be made to the charged percentages.

Charged percentage for growers: 0.2% of product sales.

The charged percentages for trading companies will remain unchanged:

0.19% up to €11 million in product purchases;

0.12% between €11 and €50 million in product purchases;

0.06% above €50 million in product purchases.

This means all businesses in the horticulture sector will be contributing, also if trading takes place outside the auction house, thus creating a more level playing field.

The basic principle of the GBD is to change as little as possible to the currently charged percentages and calculations in order to ensure a smooth transition. The percentages and sliding scales have been the same for many years.
The difference in percentages between trading companies and growers can be explained in part by the margins achieved, with trading companies earning lower margins than growers.

The net percentage will be lower because everyone is subject to a 15% refund. In other words, all growers and trading companies will receive a refund of 15% on their total contributions to the Flower Council of Holland. This is a transitional arrangement that applies for the entire duration of the GBD, which runs from 2024 through 2027.
Payment will no longer be collected via Royal FloraHolland, but by an external administration office.

Will it cost me more or less? >> Growers
The vast majority of growers will continue to pay the same amount. Thanks to the 15% refund, many growers will pay 15% less. More specifically:

I am a grower of cut flowers and a member of an auction company: thanks to the refund scheme, you will pay 15% less.

I am a grower of house plants and a member of an auction company: thanks to the refund scheme, you will pay 15% less.

I am a foreign grower of cut flowers or house plants and a member of an auction company: thanks to the refund scheme, you will pay 15% less.

I am a Dutch grower of cut flowers or house plants and am not a member of an auction company: you will pay a percentage of your product turnover. If you already supply to the auction, you are already paying on that share. You will receive a 15% refund on the total amount.

I am a foreign grower of cut flowers or house plants and am not a member of an auction company: you will not contribute. Foreign growers who are not members of a Dutch auction company are beyond the legal scope of a GBD.

I am a grower of garden plants, bedding plants, shrubs: you will not (or no longer) contribute. Even if you are currently a member of an auction company, you will no longer contribute. The application does not pertain to the product category that includes garden plants, shrubs, etc. (see question 7). That said, campaigns could still be run on a voluntary basis (e.g. for Outdoor Plants).

Wholesale The charged percentages will remain the same. Even the graduated scale will remain the same (see also question 9). The charge will be based on product purchases of cut flowers and house plants, i.e. not (or no longer) on garden plants including shrubs, trees, bedding plants and perennials. Whether or not you will pay the same, less or more is something that will be company-specific. The vast majority of trading companies will continue to pay the same amount and, in many cases, less thanks to the 15% refund. A few examples:

I am a wholesaler of cut flowers and purchase via the auction company: thanks to the refund scheme, you will pay 15% less.

I am a wholesaler of cut flowers and purchase via the auction company and via other channels: You will also pay on product purchases made via the other channels. Promotional campaigns and all other activities will all focus on cut flowers. But you will receive a 15% refund on the total contribution amount.

I am a wholesaler of house plants, bedding plants and perennials and purchase via the auction company: You will pay less because the garden plants category is beyond the scope of the application. You will also receive a 15% refund.

I am a wholesaler of house plants, bedding plants and perennials and purchase via the auction company and via other channels: You will not pay (or no longer pay) on the garden plants category. However, you will pay on the house plants category, including on purchases made via other channels. How this works in practice will differ from company to company. Either way, you will receive a 15% refund.

I am a Dutch wholesaler and more than 50% of my business is done outside Europe: You will not contribute because the Flower Council’s activities focus on Europe.
Will the charge of the Flower Council apply to grower-to-grower sales?The grower-to-grower arrangement will remain in place in its present form. This means there will be no double charges on the same products.
Will the charge of the Flower Council apply to B2B sales? A single Flower Council charge will apply in line with the existing trade arrangement. For example, there will be one charge on sales between a Dutch import company and a Dutch export company. Thus no double charges.

Help to determine the future of collective promotion, knowledge sharing and sector communication

Who is eligible to vote? >>Each business will get just one vote. For methodological reasons, a vote will only be declared valid if it has been cast by the business owner, director, a major shareholder or another legal representative.
How will you/your employer be able to participate in the vote?Independent research firm Motivaction will distribute the survey via e-mail at the end of March 2023. Unfortunately, Motivaction does not possess the contact details of all directors, owners and major shareholders in the horticulture sector. If you do not receive an invitation, please submit your details HERE and independent research firm Motivaction will send you an invitation to vote. It goes without saying that these details will be handled confidently in line with applicable GDPR guidelines.
When will there be clarity about the results? >>Motivaction will count all cast votes as soon as possible after the voting period comes to an end, and will check to what extent all criteria have been met. The report will be discussed with Brancheorganisatie Sierteeltproducten (a professional body for the horticulture sector) shortly thereafter.
What else will happen? >> Brancheorganisatie Sierteeltproducten will decide which follow-up steps will be taken. It will assess the report and the demonstrated level of support. Brancheorganisatie Sierteeltproducten believes that sufficient support will be demonstrated by a minimum response rate based on the number of companies and turnover per company category (small, medium, large), separately for growers and trading companies. These minimum response criteria have been statistically determined.
66.6% of the cast votes must be positive. If the outcome is insignificantly lower (between 60% and 66.6%), Brancheorganisatie Sierteeltproducten will meet with the Flower Council of Holland to discuss the GBD application.

After the results have been evaluated, Brancheorganisatie Sierteeltproducten will submit the application for a GBD to the Ministry of Agriculture, Nature and Food Quality. The ministry will first submit the application to the European Commission for approval, after which a final decision will be made by the Minister of Agriculture, Nature and Food Quality.
This GBD will be issued for a period of four years. Once this expires, a new consensus test will be needed and you will be given another opportunity to vote.

If Brancheorganisatie Sierteeltproducten does not submit a GBD application, the collection model will be abandoned. This will also spell the end of the Flower Council’s collective activities. The consequences for the sector will be that no further collective activities will be organised to boost demand for flowers and plants. Advertising campaigns, PR activities, content marketing, shopper marketing, sector-related consumer communication and consumer surveys will have to be personally organised and funded by businesses that operate in the sector.
This will also result in all the amassed consumer-related knowledge which is currently shared with the sector, being lost.
How long will the GBD last? >>The GBD application covers a four-year period running from 1-1-2024 to 31-12-2027.
Who will monitor how much I must pay?All market participants (both members and non-members among both growers and buyers) are legally required to register and to report their product purchases and/or sales.
An independent external organisation will be responsible for all administrative activities. Random inspections will also take place to monitor compliance.

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