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What is Fairtrade?

Fairtrade is a charitable multi-stakeholder organization, that fights for more fairness and transparency in international trade as well as a more balanced economic system to guarantee the securing of social rights for small farmers and workers standing at the beginning of the supply chain.

Global Strategy

To ensure a fair world trade with fair working conditions and living wages for workers and small farmers in the so called developing countries, Fairtrade set up five strategic goals:

1. Creation of better conditions for farmers and workers
2. Consulting and funding programmes to strengthen
3. Developing new markets for fairtrade products
4. Influence political decisions
5. Establishing strong international systems


The umbrella organization FLO e. V. (Fairtrade Labelling Organizations International) consists of different members: national fairtrade organizations (in Germany TransFair e. V.), producer networks and fairtrade marketing organizations. The latter is responsible for the establishment of new markets for Fairtrade. The Fairtrade producer networks represent the interests of small farmers and workers in Latin America and the Caribbean, Asia and Africa. This regional coalition is open for producer networks to join. They will be supported concerning certification, financing, development and further training.

The organization holds a General Assembly once every year, which ratifies new Board directors.. The General Assembly and the Board of Directors are the central decision-making body. They decide on standards, minimum prices, bonuses etc. All participating stakeholders are part of this transparent decision making process.


The Fairtrade-Standards are the core of the fairtrade system. Their continuable high quality, practical implementation and the strict, independent controls guarantee its credibility. These standards are an effective tool to implement a sustainable development for all cooperating farmers and fairtrade certificated plantations. They are revised in regular intervals, while following the guidelines of the ISEAL (International Social and Environmental Accreditation and Labelling Alliance). ISEAL is the umbrella organization for standard-setting organizations in the social and environmental sector. The standards apply worldwide and along the entire value chain for all small farmers organizations, plantations, importers and exporters, resellers and companies involved in the production and marketing of fairtrade products. There are different requirements for the different target groups (small farming organisations, plantations, contract farming) and the different production groups. For one thing there are general or basic standards, that include all fundamental criteria concerning the social, ecological and economical sector.

Basic Standards
Social criteria
Small farmers and workers are to be strengthened
  • Cooperative: the organizations are to consist of democratic communities
  • Plantations: trade union organizations are expected to be supported
  • Working conditions must be regulated
  • Exploitative child labour is prohibited
  • Discrimination is prohibited
Ecological criteria
Concerning aspects of environmental protection the people are at the center
  • Cultivation must be environmentally friendly
  • Natural resources must be protected
  • Dangerous pesticides are prohibited
  • It is not allowed to genetically alter seeds
  • Organic farming will be promoted (organic supplement payment)
Economical criteria
These criteria include requirements to be met by sellers and producers
  • Fairtrade-minimum price and Fairtrade-bonus must be paid
  • The flow of goods and money must be traceable
  • Use of the seal follows guidelines
  • Trade relations must be transparent
  • Pre-financing (producer groups do have the right to demand a pre-financing)

Minimum price
The costs of a sustainable production must be covered. For that reason Fairtrade-producers receive a minimum price or the world market price if the latter is higher than the minimum price.

Bonuses are available for the Fairtrade-producer organisations. The decision on bonuses is being made democratically and without interference by Fairtrade. They can be used for social, environmental or educational projects.

All criteria are either key or development requirements. They must be met at a specific time. To gain a Fairtrade certification one must first and foremost meet the key requirements (like no child labour). Additionally development requirements must be met, which list a number of further long-term goals. Part of these requirements are the optimization of the working conditions and environmental measures.

Additional to the basics standards there exist the respective product standard and the seller standard. Those always apply to all producer organizations (cooperatives, plantations and contract farming). This means that there is not one Fairtrade standard, but a number of different Fairtrade standards, which must be met.

Product standard
There exists a specific product standard for every raw material, because every product demands different trading conditions. This also applies to fairtrade minimum wage and bonuses.

Seller standard
The main point of the seller standard is transparency. It aims to ensure a safe and fair trade regulation between manufacturer and seller. The standard regulates among other things contracts, procurement planning, method of payment (e.g. pre-financing) and the minimum price and bonus payments.
A special projects is the Fairtrade textile standard, which aims to improve working conditions and fair wages in the textile industry. Together with the Fairtrade cotton standard Fairtrade intends to ensure a fair trade along the entire supply chain of the textile production.

Controls (audits) to ensure the Fairtrade-standards are carried out directly on-site by the FLO-CERT GmbH, an independent certification organization and subsidiary company of Fairtrade International.
A company can only be certificated after the first audit. Following the first certification at least 2 more controls will take place within a three year certification cycle. Additionally to these so called monitoring audits FLO-CERT carries out unannounced controls as well. The Fairtrade certification must be renewed every three years, which allows for comprehensive controls.

Important to know

The certification with the Fairtrade label is only related to the product, not the manufacturer.
Another important thing to know is, that even though a large part of all certificated products are from organic farming, Fairtrade is not an organic label. It is first and foremost concerned with the ethical and social circumstances under which these products are produced.


The Fairtrade label has with its comprehensive standards, the commitment to a minimum price and bonuses, the great traceability as well as the strict and extensive controls a very high credibility.


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