Driven by the alarming rate of deforestation and degradation, the EU is adopting regulations to curb the trade of products linked to these issues, acknowledging forests’ crucial role in biodiversity, environmental services, and socio-economic benefits
Deforestation and forest degradation are taking place at an alarming rate. Forests provide a broad variety of environmental, economic, and social benefits, including timber and non-wood forest products and environmental services essential for humankind, as they harbor most of the Earth’s terrestrial biodiversity. This is the rationale driving the European Union (EU) to adopt a new Regulation to prevent the import and export of products that are linked to deforestation and forest degradation.
What is EUDR?
The European Union Deforestation Regulation (EUDR), published in June 2023, is a pioneering initiative that aims to protect and restore the world’s forests while promoting sustainable trade and development. It aims to reduce the impact of products bought by EU and UK citizens on the world’s tropical forests and woodland regions worldwide. Although the primary obligations of EUDR Regulation will only be enforced from 30 December 2024, it will influence an organization’s marketability of relevant products produced this year, particularly impacting food and beverage companies. The regulation includes a ban on the import and export of non-compliant products, a due diligence requirement for businesses and traders, an obligation for EU and UK member states to ensure compliance, and the establishment of a EUDR database and information system. Once the Regulation is in force, businesses and traders will have 18 months to implement the new rules. Micro and small enterprises will be allowed 24 months from the date of implementation. The clock is ticking.
How the EUDR affects businesses
The regulation requires operators and traders to
- Conduct continuing due diligence on their supply chain. This is to ensure that their products comply with the EUDR rules.
- Comply with the laws and environmental and social standards of the countries of origin.
- Provide due diligence statements for all imports and exports, including all relevant details as specified by the EUDR, to their designated national authority.
- To obtain geolocation coordinates (latitude and longitude of all plots of land) from where the commodities or products were produced or harvested, as well as the date or time range of production.
Organizations are permitted to use an “authorized representative” to manage this process which can include tracking sources, data collection and processing, risk assessments, audit trails, and the submission of documentation.
The scope of commodities and products
The EUDR impact a wide range of commodities and products, including palm oil, cattle, soy, coffee, cocoa, timber, and rubber as well as derived products such as beef, furniture, or chocolates. The derived product list is extensive and includes, for example, all wood and paper products including charcoal and printed matter, and all rubber products including tires, gloves, and tubing. This regulation aims to ensure these goods are “deforestation-free,” meaning they were produced on land free from deforestation or forest degradation since 31 December 2020.
