Companies doing business in the European Union are advised to get ready to comply with the requirements of its deforestation regulation which come into effect this Dec. 30.
Michaela Summerer, junior professional officer at International Trade Centre (ITC), said the European Union Deforestation Regulation (EUDR) prohibits the placing or making available listed commodities and products on the EU market or exporting them from the EU, unless they are deforestation-free and have been also produced in accordance with relevant legislation of the country of production.
Summerer said the scope of the EUDR are seven commodities representing the largest share of EU-driven deforestation –palm oil, soy, wood, cocoa, coffee, cattle and rubber– and many derived products such as leather, chocolate and furniture.
She said there is foreseen inclusion of additional products in the regulation’s scope after the completion of one-year review by June 2025, with particular consideration of maize and biodiesel.
“This hasn’t been confirmed yet but this is something that is already part of the regulation. So there will be a regular review of the regulation itself and the impact it has and then potentially more commodities and products will be included under the scope,” she said in a workshop organized by the Department of Trade and Industry-Export Marketing Bureau.
Mathieu Lamolle, Senior Advisor Sustainability Standards and Value Chains at ITC, said the main requirements of EUDR include data-collection on deforestation-free and those ensuring that products can be legally produced.
Lamolle said products must be produced on land that has not been subject to deforestation after Dec. 31, 2020.
“For any deforestation that had occurred after December 2020, those products would not be permitted, allowed to go into the EU market,” he said. “And deforestation is basically defined in the regulation as being the conversion of the forest into an agricultural use, whether human-induced or not.”
On the legality requirement, Lamolle said products must be produced in accordance with laws on land use rights; environmental protection; forest-related rules, including forest management and biodiversity and conservation; and tax anti-corruption, trade and customs regulations, among others.
He also advised businesses to conduct risk assessment to ensure that the information that they are collecting mostly from their suppliers is accurate and reliable, and then risk mitigation.
“So in case there is any risk, that the information would be incomplete or there would be some deforestation link to the product, those operators have the legal obligation to risk assessment and risk mitigation. So this is very important to understand that the liability is to the operators, they will face sanctions in case there are inspections and they realize that the products are not (deforestation)-free,” he added.
Lamolle said operators or companies placing listed products on the EU market must also submit a due diligence statement to the EU register containing information on products, confirming that due diligence was carried out, and that no or only negligible risk of non-compliance was found.
“Due diligence statement is actually the certificate, the self declaration that the company, the operator has done everything possible to ensure that there is no deforestation associated with their products and once they have done the due diligence statement, the declaration that they are all fine, then only they can start placing the product on the EU market,” he said.
In cases of non-compliance, Summerer said penalties must be “effective, proportionate and dissuasive”.
“Can include fines, confiscation of products, confiscation of revenues and temporary exclusion from public procurement processes,” she said.
