In amendments to the Indian Act in the early 1880s, the government imposed a permit system to control the sale of Native agricultural products. The official rationale was that this system would prevent Natives from being swindled by others, but it also prevented the exchange of produce for goods not approved of by the Indian agents. The practice also indicated government intolerance of the idea of Natives selling produce while they were receiving government-supplied rations. Adoption of these regulations may also have reflected complaints of unfair competition made by non-Native farmers who objected to the government assistance that reserves received.
Whatever the protective functions such measures may have had, in the hands of officials, the permit system became yet another tool of coercion and it furthered the policy, popular in the Indian Department and especially with Deputy Superintendent Hayter Reed, of transforming the Natives into "peasant farmers." The practical impact was to impede those Natives who were inclined to farm for profit. The amendment contributed to the perception that Natives were less efficient and discouraged them from trying to be successful. The amendment was retained and expanded in subsequent versions of the Indian Act and was extended in 1941 to include the sale of furs and wild animals. The provision on the sale of agricultural products without official permission remains part of the Indian Act, although it is no longer enforced.