The Master Bakers CCLA involves three types of contract:

The Umbrella Agreement. This is between NAMB/SAMB and DEFRA. It includes the general terms and conditions that must be met under the Master Bakers CCLA. The Umbrella Agreement will include an overall target and milestones for the whole of the Master Bakers Agreement.

The Underlying Agreement. This is between an individual Participant and DEFRA. It reflects all the terms and conditions of the Umbrella Agreement and includes company specific and/or site specific targets and milestones.

The Administrative Agreement. This is between an individual Participant and NAMB/SAMB. It specifies the responsibilities of both the Participant and NAMB/SAMB in terms of data reporting and the administration of the Agreement.

The inter-relationships between the parties in a CCLA are illustrated in Figure 1 and further details about the three contracts are given in Information Sheet 5.

At the time these Guidance Notes were published (October 2000) contractual details had not been fully agreed. Resolution on all contractual issues is unlikely before November 2000. The latest drafts of each contract are available for downloading from the Master Bakers Scheme web site (www.cclevy.com/mb).

A Participant is defined as an individual site that is eligible for a Climate Change Levy discount. In the craft bakery sector a Participant is either a bakery or a retail bakery shop that carries out food processing activities including bake-off and sandwich preparation. The structure of the craft bakery sector is such that a bakery is often associated with a number of retail bakery shops. In the Master Bakers CCLA we use the concept of a "bakery ring" that consists of:

A bakery that supplies:

1. A number of retail shops that are eligible for a Levy discount, because they carry out bake-off.
2. A number of retail shops that are NOT eligible for a Levy discount, because they do not undertake any food processing activities.

In some cases the "bakery ring" might only be one bakery and one shop, at a single location. At the other extreme, a large bakery might supply in excess of 100 shops. Companies wishing to register for the Master Bakers CCLA should fill in an Application Form for each individual bakery ring that it owns. An Underlying Agreement will be established for each bakery ring.

If you own a wholesale bakery (with no associated shops), this will be treated as a bakery ring with one bakery and no shops. Alternatively, if you own a group of shops but no bakery, this will be treated as a bakery ring with no bakery and a number of shops.

This definition of a bakery ring is very important because it will be used to define the annual product output. This is further discussed in Paragraph 7 of these Guidance Notes.

Figure 1 Contractual Arrangements