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UTZ GUIDANCE DOCUMENT Code of Conduct supply chain in Turkey
Guidance on implementation of Mass Balance traceability level for Code of Conduct
members
Code of Conduct Hazelnut Supply Chain in Turkey Guidelines for members and Certification Bodies
1. Introduction
In Turkey, most of the producer groups are organized by exporters who act as both Code of Conduct
and Chain of Custody members. After the hazelnuts are harvested, they are passed down the supply
chain by intermediaries until they reach the facilities of the Code of Conduct member. This temporary
approach will provide more visibility to the activities of intermediaries and provide a stepping stone
from which members can move towards stricter traceability levels (IP).
For information about the certification requirements for intermediaries please refer to Annex 2 of the
Certification Protocol.
2. Definitions
Consumer-end product
A product that requires no further transformation in terms of processing or packaging prior to consumption, and is destined for retail sale or foodservice
Cracking The process of removing the shell of the nut
Group A group of organized producers that are part of a shared IMS and are certified together under the option “Group certification” or “Multi-Group certification”. The group can be organized in an association or cooperative or managed by a supply chain actor (such as an exporter) or another entity.
Group member A producer who is certified as part of a group. It can be the person who is the actual operator of the farm (e.g. a sharecropper) and does not need to be the land owner.
Group administrator
An actor that organizes and administers a producer group and that is held responsible for the IMS. The group can be led by an association, union, chamber, cooperative or supply chain actor (exporter), or another entity
Group member premium
Part of the UTZ premium received by a group that is forwarded to the individual group member, in cash and/or in kind. The group member premium does not include group management spending (such as use of premium for audit costs and other administrative purposes), nor services or products delivered to the whole group/community (such as facilities or trainings).
Hazelnut kernel (Natural) hazelnut kernel of the nut free from the shell
Intermediary Any actor in the Code of Conduct supply chain that physically handles, collects, trades and/or stores UTZ certified product before it reaches the central location(s) of a Producer/Producer Group. This includes all actors regardless of whether they own the product, are subcontracted by the Producer/Producer Group or are part of the Producer/Producer Group.
Internal inspection Inspection carried out on behalf of the IMS and by one or more internal inspectors to assess conformity of group members with all applicable requirements of the UTZ Code of Conduct.
Internal management system (IMS)
A documented system of quality management required for group and multi-group Code of Conduct certification. The purpose of an IMS is to facilitate the efficient organization and management of the group and to ensure that the group and group members comply with the applicable requirements of the UTZ Code of Conduct.
In-shell hazelnuts In-shell nut free from husk
Member All producers, producer groups and SCAs that have successfully registered with UTZ.
Processed hazelnut Processed hazelnut kernel (roasted or natural) or pure consumer-end hazelnut product obtained after blanching, chopping, slicing, grinding and other processing activities. Processed hazelnut includes: chopped, sliced, diced, blanched, ground, and crushed hazelnut, amongst others.
Roasted kernels Product obtained by roasting natural hazelnut kernel.
3. Certification options for Certificate holders in Turkey
The group administrator is held responsible for all the actors operating under its scope as shown in the
tables below. It should be noted that Intermediaries may be associated with several Code of Conduct
members. However, the group administrator can only receive product as UTZ certified in its Code of
Conduct scope if:
-The group administrator takes responsibility for compliance of the intermediary with
traceability requirements for intermediaries
groups own plantation or group members.
Option 1: Union/chamber-led group Applies to A group of organized producers (group members) that implements an IMS. The
group can be organized by a group administrator (association, cooperative, union or chamber). To ensure the traceability of the product, the group administrator needs to work in collaboration with the UTZ exporter/processor that buys from the group members and/or intermediaries to create a system that ensures traceability between the group members and the UTZ exporter/processor.
Applicable standard Chain of Custody and Hazelnut Annex Code of Conduct and Hazelnut Module
Self-assessment Evaluation performed by or on behalf of a member of its own of one or more of the UTZ standards.
Subcontractor A supply chain actor contracted by the member to carry out specific activities. Typically they do not own the UTZ certified product.
Supply chain actor (SCA)
An entity that operates within the UTZ supply chain and is not a producer / producer group. Examples of SCAs are processors (including subcontractors) and traders.
Traceability level Defines to what degree a product can be traced back to its certified source. In the UTZ program, there are three options (IP, SG and MB) of traceability levels that can apply to the certified product and related processes. Identity Preserved (IP): The identity of a certified producer/producer group is maintained along the supply chain. The product can be traced all the way back to the producer/producer group that it originates from. A variation of the IP traceability level is Mixed Identity Preserved (MixIP). Under this level, the product from multiple producers/producer groups is mixed, but the product can be traced back to this group of producers/producer groups. Requirements which apply to the IP traceability level also apply to MixIP. Segregation (SG): UTZ certified product from different producers/producer groups is mixed. The product was produced by UTZ certified producers/producer groups, however the identity of the specific producers is lost. Mass Balance (MB) (Note: the MB option is only possible for UTZ certified cocoa and hazelnut SCAs): Administrative traceability of a certified product. Mass balance traceability allows a proportion of the outputs of a SCA to be sold with an UTZ MB claim, corresponding to the quantity of UTZ certified inputs (and considering the conversion rates).
UTZ Premium An additional cash amount paid above the market price for a similar conventional (noncertified/ non-verified) product, because the product is sustainably produced and meets the requirements of the UTZ Certified standards. The UTZ premium is mandatory and agreed upon between the UTZ Code of Conduct certified group or producer and the first buyer, is net of any deductions for repayment of pre-financed goods or services, and is registered in the UTZ traceability system.
Responsibility for compliance Chain of Custody
The exporter/processor is responsible for: (1) the compliance with all the applicable CPs of the individual site/all sites under the central management that handle UTZ product, (2) for the compliance of the subcontractor(s) that handle UTZ product with the applicable CPs, (3) the conformity of the intermediaries that handle UTZ product with the applicable CPs.
Code of Conduct
The group administrator is responsible for: (1) the proper functioning of the IMS and for conformity with the CPs applicable to the group, (2) the conformity of the group members with the CPs applicable to the group members, (3) the conformity of the intermediaries with the CPs applicable to intermediaries (if applicable)1
Code of Conduct and Chain of Custody
Both the exporter/processor and the group administrator are responsible for sharing the necessary information to keep the traceability of the products and ensure the compliance of both parties with the applicable CPs.
Option 2: Exporter/processor-led group Applies to An actor (exporter /processor) that has one site or multiple sites (administered under
a central management) where processing activities (excluding farming) may take place. This same actor can act as a group administrator for a group of organized producers (group members) that implements an IMS.
Applicable standard Chain of Custody and Hazelnut Annex Code of Conduct and Hazelnut Module
Responsibility for compliance Chain of Custody
The exporter/processor is responsible for: (1) the compliance with all the applicable CPs of the individual site/all sites under the central management that handle UTZ product, (2) for the compliance of the subcontractor(s) that handle UTZ product with the applicable CPs.
Code of Conduct
The group administrator is responsible for: (1) the proper functioning of the IMS and for conformity with the CPs applicable to the group, (2) the conformity of the group members with the CPs applicable to the group members, (3) the conformity of the intermediaries with the CPs applicable to intermediaries2
4. Traceability levels
In Turkey, groups are mostly organized by exporters or, to a lesser extent, by chamber/unions.
Depending on these options, there can be other actors involved in the trade of hazelnuts at Code of
Conduct level, such is the case of manavs or crackers. Additionally, there could also be other actors
subcontracted at Chain of Custody level. The group administrator, being responsible for the correct
implementation of the Code of Conduct requirements and, if applicable, Chain of Custody
requirements, is held responsible for the compliance of all the actors involved in the chain
(intermediaries and subcontractors). In case of union/chamber led groups, this responsibility falls
under the exporter/processor the group is associated to. Each actor must function under a specific
traceability level that is equal to or lower than the supplied input. The applicable traceability levels are
listed below from “strongest” to “weakest”:
Traceability level Type of traceability CoC ChoC
1 Refer to Annex 2 of the Certification Protocol for additional information 2 Refer to Annex 2 of the Certification Protocol for additional information
Identity preserved Physical traceability with producer information
Applicable Applicable
Mass balance Administrative traceability
Applicable Applicable
Chamber/union led groups: the graph below shows the possible combinations of traceability levels
through the chain for these groups. In this case, the group organizer needs to work in collaboration
with one specific exporter/processor. The exporter/processor is held responsible for the
subcontractors acting on its behalf.
Exporter/processor led groups: under this structure, there are often other actors involved in the
trade and processing of hazelnuts, such as, manavs and crackers (intermediaries). The graph below
shows the possible combinations of traceability levels through the chain, under the Code of Conduct
scope, for such groups.
5. Clarification of compliance with the Code of Conduct Control point G.A.23 of the Code of Conduct mentions that “the UTZ certified product, including
carry-over stock from previous certification years, is visually identified as such and is at all times
strictly separated from non UTZ certified products”. However, for members operating at MB, only
documentary traceability is required.
6. Hazelnut supply chain in Turkey In Turkey, the supply chain of hazelnuts can have different structures and hence, different actors
involved. The scheme below shows the most common group administrators, supply and suppliers.
Group administrator
hazelnuts to the subcontractors of a chosen UTZ exporter
Exporter/processor
Exporter buys in-shell hazelnuts from manavs and/or group
members and cracks them in its own facilities/subcontracts this
activity
The following diagrams represent a simplified version of the UTZ hazelnut supply chain, including
the main actors and traceability levels.
Option 1: Chamber/union led groups: group members sell in-shell hazelnuts to the subcontractors
of a chosen UTZ exporter/processor. To ensure the traceability of the product the chamber/union
works in collaboration with one exporter/processor.
3 For additional information consult the Hazelnut Annex of the Chain of Custody Standard
Traceability requirements per actor
Group members All group members belonging to a specific group sell in-shell hazelnuts to the subcontractors of the chosen exporter/processor or directly to the exporter/processor. Documentary and physical traceability must be kept.
Group administrator (chamber/union)
The group administrator (chamber/union) must ensure that the group and group members comply with the applicable requirements of the UTZ Code of Conduct. The group administrator has a Code of Conduct account in the UTZ traceability system and should work together with one chosen exporter/processor to guarantee traceability of the products and ensure the compliance of both parties with the applicable CPs.
Subcontractors (manavs and/or crackers)
Manavs buy in-shell hazelnuts from group members. The traceability level applied to manavs depends on the traceability level they can offer and are subcontracted for by the exporter. - IP: when UTZ in-shell hazelnuts from a particular group are separated from in-
shell hazelnuts from other UTZ groups and from conventional hazelnuts - MB: when UTZ in-shell hazelnuts are mixed with in-shell hazelnuts from other UTZ
groups and with conventional in-shell hazelnuts. In this case, manavs must keep a documentary traceability. And manavs are only allowed to sell onwards with the UTZ MB claim, a volume corresponding to the quantity of UTZ certified hazelnuts they have bought from UTZ group members
Crackers buy in-shell hazelnuts from manavs and sell hazelnut kernels to the group administrator. Such volume must respect the conversion rates for cracking 3 - IP, 1:0,50 (with bandwidth 0,45-0,56) - MB, 1:0,50
The conditions for the traceability levels previously explained for manavs, also apply to crackers. Both need to keep documentary and/or physical traceability depending on the traceability level they have agreed upon with the group administrator.
Exporter/processor Exporter/processors are held responsible for the subcontractors (manavs, crackers) they work with. Therefore, they must safeguard their compliance and guarantee the traceability of the product. To ensure this, exporters/processors must work in collaboration with the group administrator. The exporter/processor must choose a traceability level (IP, MB) and agree on it with the subcontractors. This actor can buy in-shell hazelnuts or hazelnut kernels as explained below: - Manavs or group members: exporter/processors buys in-shell hazelnuts from the
group members or from manavs. Once these arrive to the facilities, they are converted to hazelnut kernel on-site or by subcontracted crackers.
- Crackers: exporter/processors buys hazelnut kernel from crackers.
Based on the amount of hazelnuts received the exporter/processor agrees upon a transaction in the UTZ traceability system with the group administrator, taking into account the conversion rates from in-shell hazelnuts to hazelnut kernel, in accordance with the chosen traceability level. Hazelnut kernels can be further processed into other products (processed hazelnuts, roasted hazelnuts)
Manufacturer of consumer-end products
Manufacturer of consumer-end products buy hazelnut kernels, processed hazelnuts or roasted hazelnuts to produce (pure and/or not pure) hazelnut consumer-end products. Consumer-end product
manufacturers can only choose a traceability level with a physical link that is equal to or lower than the supplied input.
Option 2: Exporter/processor-led groups: there are two scenarios.
- Exporter/processor buys in-shell hazelnuts from manavs and/or group members and cracks them in its own facilities or subcontracts this activity
- Exporter/processor buys hazelnut kernels directly from crackers
4 Depending on how the group administrator sets the supply chain, crackers could be under the scope of Code of Conduct or Chain of Custody. 5 For additional information consult the Hazelnut Annex of the Chain of Custody Standard
Traceability requirements per actor
Group members All group members belonging to a specific group sell in-shell hazelnuts to intermediaries or the group administrator. Documentary and physical traceability must be kept
Intermediaries (manavs and crackers)
Manavs buy in-shell hazelnuts from group members. The traceability level applied to manavs depends on the traceability level they can offer and what is agreed upon with the group administrator. - IP: when UTZ in-shell hazelnuts from a particular group are separated from in-
shell hazelnuts from other UTZ groups and from conventional hazelnuts - MB: when UTZ in -shell hazelnuts are mixed with in-shell hazelnuts from other
UTZ groups and with conventional in-shell hazelnuts. In this case, manavs must keep documentary traceability and are only allowed to sell onwards, with the UTZ MB claim, a volume corresponding to the quantity of UTZ certified hazelnuts they have bought from UTZ group members
Crackers 4 buy in-shell hazelnuts from manavs and sell hazelnut kernels to the group administrator. Such volume must respect the conversion rates for cracking 5 - IP, 1:0,50 (with bandwidth 0,45-0,56) - MB, 1:0,50
The conditions for the traceability levels previously explained for manavs, also apply to crackers. Both actors keep documentary and/or physical traceability depending on the traceability level.
Group administrator (exporter)
The group administrator has Code of Conduct and Chain of Custody accounts in the traceability system. The group administrator must choose a traceability level (IP, MB) and agree on it with their intermediaries at Code of Conduct level. Exporters/processors can buy hazelnut kernels or in-shell hazelnuts as explained below: - Manavs or group members: exporter/processors buys in-shell hazelnuts from the
group members or from manavs. Based on the amount of in-shell hazelnuts bought as UTZ and on the traceability level, the group administrator can make transactions in the UTZ traceability system of in-shell hazelnuts from the Code of Conduct account to the Chain of Custody account. Once the volume has been transferred to the Chain of Custody account, it can be further processed to obtain hazelnut kernel. In this case, the group administrator can crack the hazelnuts in its own facilities or can subcontract a cracker, if this is done, the group organizer is held responsible for the compliance of the subcontractor(s).
- Crackers: the group administrator (exporters/processors) buys hazelnut kernels from crackers. Based on the amount of hazelnut kernels bought as UTZ and on the traceability level, the group administrator can make transactions in the UTZ traceability system of hazelnut kernels from the Code of Conduct account to the Chain of Custody account
Hazelnut kernels can be further processed into other products (processed hazelnuts, roasted hazelnuts)
Manufacturer of consumer-end products
Manufacturer of consumer-end products buy hazelnut kernel, processed hazelnuts or roasted hazelnuts to produce (pure and/or not pure) hazelnut consumer-end products. Consumer-end product manufacturers can only choose a traceability level with a physical link that is equal to or lower than the supplied input.
Involvement of TMO in the UTZ hazelnut supply chain
In Turkey it can occur that TMO (Turkish Grain Board)6 is involved in the hazelnut supply chain. The
involvement of TMO in the hazelnut supply chain is considered similar as the involvement of Manavs
in the hazelnut supply chain. TMO buys in-shell hazelnuts from group members. Exporter/processor
buys in-shell hazelnuts from TMO and/or group members and cracks them in its own facilities or
subcontracts this activity.
If TMO is involved in a certificate holder’s supply chain and the certificate holder wants to sell the
volumes purchased from TMO as UTZ certified, TMO must be included as actor in the certificate
holder’s supply chain in order to maintain traceability from the group members to IMS. UTZ
recognizes that a governmental actor such as TMO is excluded from the possibility of receiving an
internal as well as external inspection in context of the UTZ program. However, traceability at Mass
Balance level is to be maintained through documentation at all levels. TMO must be included in the
certificate holder’s supply chain if they are to operate as their manav.
7. Mass Balance at Code of Conduct level
When intermediaries operate at Mass Balance traceability level, the volume sold with the UTZ MB
claim must correspond to the quantity of UTZ certified inputs. This implies that the group
administrator may not receive the entire certified volume and thus can only make transactions
based on the UTZ volume that arrives to its facilities. Please note that crackers operating at MB
must take into account the conversion rate from in-shell to kernels7. The following example and
diagram portrays manavs as intermediaries.
Example: the diagram below shows an exporter/processor-led group with a certified volume of
40.000 kg. This member has both, Code of Conduct and Chain of Custody certificates.
6 The Turkish Grain Board (TMO), founded in 1938, is a limited liability and autonomous state economic enterprise running
on state capital in accordance with the provisions under Decree Law No 233 of 08/06/1984 on State Economic Enterprises.
TMO is mainly purchasing grain, maize, paddy, poppy and hazelnut and is taking protective measures for producers and
consumers by regulating agricultural product markets, especially grain market, within its field business.
TMO offices in Black Sea Region purchase hazelnuts from farmers, often (far) above market price. Due to this price
difference farmers may decide to sell their hazelnuts to TMO. The amount purchased by TMO varies from year to year. In
2017, TMO purchased over 135.000 tons (in-shell hazelnut) from more than 75.000 farmers in all Black Sea Region.
7 IP, 1:0,50 (with bandwidth 0,45-0,56), MB, 1:0,50
Group members Two group members with a certified production of 20.000 Kg each. Each group member sells 10.000 kg to (1) UTZ manavs working with the group administrator and (2) to non-UTZ manavs. Group members are only allowed to sell as IP.
The conditions mentioned above also apply to chamber/union-led groups. In such a case, the
exporter/processor working in collaboration with the group administrator is held responsible for the
traceability of the product and for the compliance of its subcontractors (manavs and crackers).
Intermediaries (manavs)
The group administrator works with two manavs. As these manavs operate at MB level, a documentary traceability must be kept and they are only allowed to sell onwards, with the UTZ MB claim, a volume corresponding to the quantity of UTZ certified hazelnuts they have bought from UTZ group members. In this example, each of the manavs bought 10.000 kg from group members and, therefore, is allowed to sell a maximum of 10.000 Kg each to the group administrator. However, as one of the manavs sold 5.000 Kg to a non-UTZ exporter, they only sold a total of 15 000 Kg to the group administrator.
Group administrator (exporter/ processor)

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