Currently the most widely recognized definition of fair trade was created by an informal association of the four main Fair Trade networks (Fairtrade Labelling Organizations International, World Fair Trade Organization, Network of European Worldshops and European Fair Trade Association):

'Fair Trade is a trading partnership, based on dialogue, transparency and respect, that seeks greater equity in international trade. It contributes to sustainable development by offering better trading conditions to, and securing the rights of, marginalized producers and workers - especially in the South. Fair Trade organizations (backed by consumers) are engaged actively in supporting producers, awareness raising and in campaigning for changes in the rules and practice of conventional international trade. Fair Trade's strategic intent is:

• deliberately to work with marginalized producers and workers in order to help them move from a position of vulnerability to security and economic self-sufficiency
• to empower producers and workers as stakeholders in their own organizations
• to actively to play a wider role in the global arena to achieve greater equity in international trade.'

In 2009 together we developed the Charter of Fair Trade Principles. This document defines our common vision, principles and defines Fair Trade/ Fairtrade. You can download the Charter of Fair Trade Principles here.

The term Fairtrade is used to describe the certification and labelling system governed by FLO. The Fairtrade system allows consumers to identify goods  that have met Fairtrade standards.

The term Fair Trade is used to refer to the Fair Trade movement as a whole and can be used to describe both labelled and unlabelled goods and the work of Alternative Trade Organizations (ATOs), Fair Trade federations and networks such as NEWS, EFTA etc. The term fair trade is a broader term often used to describe one or many of the above, and is also used to refer to trade justice issues. 

Ethical trading means companies are involved in a process of trying to ensure that the basic labour rights of the employees of their third world suppliers from developing countries are respected. The FAIRTRADE Certification Mark, which applies to products rather than companies, aims to give disadvantaged small producers more control over their own lives. It addresses the injustice of low prices by ensuring that producers receive fairer terms of trade and better prices – however unfair the conventional market is. On top of the Fairtrade Minimum Price, Fairtrade includes an additoinal sum, called the Fairtrade Premium, for producer organizations or workers bodies to enable them to invest in social, economic and environmental improvements.

The FAIRTRADE Certification Mark is an independent consumer label which appears on products to signify that Fairtrade standards have been met. When you buy products with this Mark disadvantaged producers get a better deal. For Fairtrade certified goods, producers receive prices aimed at covering the cost of sustainable production. They also get an additional sum, called the Fairtrade Premium, for social, environmental and economic development.

For a product to display the FAIRTRADE Certification Mark it must meet international Fairtrade Standards. These standards are established by FLO and are set in accordance to the requirements of the ISEAL Code of Good Practice in standards setting. The standards are the result of broad consultations of different stakeholders and external experts.

Producer organizations supplying Fairtrade Products are then certified against these standards by FLO-CERT, a separate certification body, owned by FLO, which carries out regular audits and inspections.

The Fairtrade system provides tangible benefits to small-scale farmers and workers, consumers and the environment.

1. Small-scale farmers and workers: Approximately 1.5 million workers and farmers in 58 developing countries in Africa, Asia and Latin America benefit from Fairtrade. Some of the benefits of Fairtrade include:

• Increased power/ improved role in the trade of their produce
• Improved access to low or no-interest loans
• Technical assistance for building infrastructure to improve production
• Communications systems, and collectively-owned transport and processing equipment
• Better health care and education
• Technical training and skill diversification for cooperative members and their families

2. Consumers: The Fairtrade system benefits consumers by:

• Having the opportunity to buy in line with their principles
• Being empowered them to play their part in addressing global trade inequities
• Getting in exchange high quality products

3. Environment: Fairtrade rewards and encourages farming and production practices that are environmentally sustainable, such as:

• Integrated farm management systems which minimize pollutants, pesticides and herbicides
• Organic agriculture techniques
• Banning the use of most dangerous pesticides

In 2007 Fairtrade sales amounted to approximately €2.3 billion worldwide, a 47 % year-to-year increase over 2006. At the end of 2008 there were 872 Certified Producer Organizations in 58 developing countries. That represents more than 1.5 million producers, about 7.5 million people, including dependents, who are benefiting directly from Fairtrade.

There is no evidence for this and in fact the it is difficult to imagine how Fairtrade could have this affect. Fairtrade is a voluntary model of trade that is consumer/market led. 

It is true Fairtrade includes prices designed to meet producers' sustainable costs of production. But because Fairtrade is market led it can only grow in line with market demand. Farmers only receive the Fairtrade Minimum Prices and Premiums for produce where they  have a buyer willing to pay for them. As there are already more produce than the market can support many producer groups continue to sell a lot, and in some cases most, of their produce to the conventional market.

Fairtrade certified producers use the additional income from Fairtrade to improve the quality of their lives and to invest in their businesses. Farmers also invest the Fairtrade Premiums in crop diversification in order to escape from their dependence on a single crop as their primary source of income. Because Fairtrade certified producers often choose to spend their social Premiums on projects such as improving local schools, health, water or sanitation projects, this means the benefits of Fairtrade can be shared more widely by the local community, not just the farmers themselves.

Read our Fairtrade and Child Protection Factsheet

Fair Trade started as early as the 1950s. It started as a partnership between non-profit importers, ususally non-governmental development charities as a way of alleviating poverty in poorer countries. Later it was recognized that small-scale producers in developing countries were struggling to make a decent living with low market prices and high dependence on local intermediaries. They saw fair trade as an opportunity to protect their livelihoods, bypass the middlemen and directly access Northern markets. Over the years, more and more Alternative Trade Organisations (ATOs) were created in different countries, often closely linked to development organizations and World Shops. These networks of ATOs and World Shops played a vital role in the development of Fair Trade as we know it today.

In 1988, in an effort to expand the distribution of fair trade products to mainstream retailers, a Dutch ATO, Solidaridad, found an innovative way to increase sales without compromising consumer trust in Fairtrade products and in their origins. The organization created a label, called Max Havelaar, which guaranteed that the coffee was bought directly from democratic small-farmer organizations at a price that covered the costs of production. The label, was named after the hero of a best-selling 19th century book about the exploitation of Javanese coffee plantation workers by Dutch colonial merchants.

The concept caught on: within years, similar organizations such as the Fairtrade Foundation, TransFair and Rättvisemärkt, emerged across Europe and North America in an effort to create fairer trading conditions for producers of different products. The organizations created and launched their own campaigns and Certifications Marks independently.

Already working together these Fairtrade Labelling Initiatives formed Fairtrade Labelling Organizations International (FLO) in 1997. FLO is the global umbrella organization for Fairtrade. Its role is to set Fairtrade Standards, support  disadvantaged producers and coordinate the development of global strategy on Fairtrade. 

At present, 19 Fairtrade Labelling Initiatives are members of FLO. The FAIRTRADE Certification Mark is now available on dozens of different products, including hot beverages, fruit juices, fresh fruit and vegetables, biscuits, cakes and confectionary, sugar, honey and conserves, rice, wines, nuts and non-food products such as flowers, football and cotton.

In the early years each Labelling Initiative had its own certification label.

In 2002, FLO launched the international FAIRTRADE Certification Mark that you see in most countries today. The goal of the new mark was to improve visibility of the Mark on supermarket shelves, convey a dynamic, forward-looking image for Fairtrade, facilitate cross border trade and simplify procedures for importers and traders.

FLO is made up of 19 Fairtrade Labelling Initiatives. 17 member organizations use the FAIRTRADE Certification Mark to signify that Fairtrade standards have been met.  In the USA and Canada, the Fair Trade Certified™ labels indicate that the same Fairtrade standards have been met.  

See an introduction to certification. Also refer to the FLO-CERT website.

See the section of this website about Standards.

A Fairtrade price is set for most Fairtrade products, with the specific intention of covering the producers' costs of sustainable production. Research in each product is undertaken and there is a lengthy consultation with producers and experts around the world before settling on Fairtrade prices for products.

Of course costs of production and market prices fluctuate so it is difficult to guarantee that the Fairtrade price always covers the costs of sustainable production. The important issue is that it acts as a safety net in times when the market price is very low.

On top of the production costs, FLO sets an additional sum, the Fairtrade Premium, which is invested in social, economic and environmental development. Decisions on how to use the premium are taken democratically by producers within the organization or hired workers in a joint body.

Fairtrade prices are periodically reviewed to ensure producers’ production costs are still being covered.

Introducing a new product into the Fairtrade system is slow and costly. That is because we try to get it right and this takes a great deal of research. If you know of a product that would sell well in your market, we would encourage you always to talk to your Labelling Initiative. Be realistic, however. A product needs to sell in considerable volumes before a producer begins to benefit from the sales.

FLO receives many requests for help from students and researchers. We are delighted that more and more people are interested in Fairtrade. However, we are not able to help with individual requests for information for projects and dissertations. We must prioritize activities that will directly support producers who are struggling to improve their lives.

We will put as much information on our website as possible to help you in your efforts. We also recommend you visit the websites of our members and other organizations. Please note that we don’t provide information about individual producer organizations at this time. Some producers are concerned about being inundated with requests for information and visits from tourists which they simply don't have the capacity to accommodate.  

The FAIRTRADE Certification Mark was introduced by FLO in 2002. The symbol is intended to communicate a positive message about fairness, empowerment, progress and hope.

Please see becoming a Fairtrade producer. Please see also the FLO-CERT website.

See 'Becoming a certified trader' in the Quick Links Selling Fairtrade page.

In order to get permission to use the FAIRTRADE Certification Mark on your product, you need to obtain a license.

If you are located in a country covered by a national Fairtrade Labelling Initiative, please contact them. They will be able to provide you with a license to sell in other countries as well.

If there is no national Fairtrade Labelling Initiative in your country please contact license@fairtrade.net.

If you wish to distribute and/or sell consumer-ready packaged Fairtrade products (retailer, distributor, web shop), then you do not need a license yourself.  

If you are a company that is interested in offering Fairtrade products to your customers, you should start by looking at the website of the Fairtrade Labelling Initiative that covers your country.

If there is no Fairtrade Labelling Initiative for your country please contact license@fairtrade.net. 

If you wish to use the FAIRTRADE Certification Mark for promotional purposes please see rules regarding the use of the FAIRTRADE Mark.

It takes a great deal of time and money to develop Fairtrade Standards to ensure that new Fairtrade Products really will benefit producers. The initial focus of Fairtrade was on agricultural commodities, such as coffee and tea, which have the most widespread impact on the livelihoods of small producers and workers in the developing world. Since then, the scope of Fairtrade is continuously being extended to other agricultural products and some manufactured products such as sports balls.

Not necessarily. Fairtrade criteria however require sustainable farming techniques, and offer a higher price for organic products. Moreover, Fairtrade Premiums are often used to train producers in organic and sustainable techniques like composting and integrating recycled materials.

If you want to know where to buy Fairtrade labelled products, you can contact the Labelling Initiative in your country, and check their website or ask them directly.

The purpose of Fairtrade is not merely to avoid exploitation of suppliers but to help make a real improvement in people’s lives. Fairtrade is based on a clear set of internationally agreed criteria, which are independently assessed and monitored, and the whole system is open and transparent. The FAIRTRADE Certification Mark is the only independent assurance of Fairtrade. If a company is claiming that it meets these standards it would be worth asking tgen if they are prepared to subject themselves to the independent scrutiny and monitoring of the Fairtrade certification system.

There has been much concern among consumers about GMO crops. Many worry the risks of environmental contamination and producer dependence to GMO seed might outweigh the benefits of the crops. FLO believes GMO crops are incompatible with Fairtrade and has adopted environmental standards and guidelines expressly forbidding their use and monitoring GMOs in nearby fields to avoid possible contamination.

Some organizations, also called Alternative Trading Organizations or Fair Trade organizations, are purely dedicated to trading fairly and have been doing so for many years before Fairtrade certification was established. These organizations were set up by some of the same third world development charities that got Fairtrade labelling going. 

However, some other companies make their own ‘fair trade’ claims without having the independent scrutiny of the FAIRTRADE Certification Mark, and perhaps without the interests of producers at heart. If you are shopping and see tea, coffee, bananas or cocoa products without the Mark, then they have  not met Fairtrade standards. It is as simple as that.

Fairtrade certification and its system of minimum pricing were designed for commodity products. It is technically difficult to adapt this model of standardized minimum pricing to crafts and other products made by small-scale artisans, which are each unique and have highly varied production processes and costs.

It does not always make sense to insist that every product ingredient should be imported from developing countries – for example, dairy ingredients such as milk, cream and eggs do not transport easily over long distances, and there are more local dairy farmers who can supply these. However we can extend the opportunities for producers in developing countries if ingredients they produce, such as cocoa, coffee, sugar, spices and fruit can be combined with locally sourced ingredients.

That’s why the Fairtrade system operates a set of rules for certifying ‘composite’ products. These are defined as manufactured or processed products, composed of more than one ingredient of which at least one is sourced from Fairtrade certified producers. The rules state that any ingredient for which Fairtrade Standards exist must be sourced from Fairtrade certified producers. They also state that at least 50% of the total ingredients must be sourced from Fairtrade certified producers.

There are several parts to this answer:

Price paid to producer

Every time you buy a certified Fairtrade product, the producer organization or plantation receives the Fairtrade price (where it exists) and an additional social premium to invest in social, environmental and business development. However, it is important to note that these payments are not linked to the retail price of the final finished product. 

Fairtrade price same or cheaper

In some markets Fairtrade products are the same price or cheaper than similar conventional products. The cost of the raw produce that is shipped, processed, packaged and marketed by others in the chain, represents a very small proportion of the cost that consumers pay. It is quite possible for companies to pay the additional costs of Fairtrade without it being reflected in the retail price at all.

Higher quality products cost more

It is also important to compare like with like. We expect to pay more for higher quality products. You will find the price of Fairtrade products is comparable with other similar quality products. If a Fairtrade product is targeted at the higher quality end of the market then it is likely to cost a similar price to other high quality products.

Retailers determine final price

Retailers determine the final price paid by consumers. Retail pricing is not controlled or influenced by FLO or any of the Labelling Initiatives. FLO-CERT verifies the right price has been made to the producer but the final price paid by the consumer is the decision of the retailer. As has already been demonstrated in mature markets, as demand for Fairtrade products grow economies of scale and disproportionate retailer margins become less and less significant.