Last week, the EU Parliament and Council were unable to reach an agreement on the proposed changes to the EU Deforestation Regulation (EUDR). The Council maintained their position that it will only agree to postpone the start of application by one year, while the Parliament also wants to change the content of the regulation. The next round of negotiations is currently scheduled for 3 December 2024. If it ends with an agreement, the law on postponement could be passed just before the originally scheduled start of application on December 30.
The Parliament is pushing to introduce a new “no risk” category into the regulation which would result in key three differences to the current regulation including no due diligence statement; no geo-location information gathering to be provided; and a lower frequency of checks to 0.1% of operators. The no-risk category would apply to countries where negligible risk of deforestation has been identified.
Unfortunately, we do not have the luxury of time and the need to agree on a compromise is urgent otherwise there is a risk that the one-year delay isn’t enacted in time and that the regulation starts applying from 30 December as originally planned.
Last month, the European Commission proposed to postpone the implementation of the EU Deforestation Regulation (EUDR) until 30 December 2025 for large companies and 30 June 2026 for small enterprises. The Commission said since all the implementation tools are technically ready, the extra 12 months can serve as a phasing-in period to ensure proper and effective implementation. “The Commission recognises that three months ahead of the intended implementation date, several global partners have repeatedly expressed concerns about their state of preparedness, most recently during the United Nations General Assembly week in New York,” the Commission said.
Background:
Under the original EU legislation which aims to reduce deforestation by ensuring that products consumed on the EU market do not contribute to deforestation and forest degradation worldwide should be enforced from 30 December 2024. The regulation introduces mandatory due diligence rules for all operators and traders who place, make available or export the following commodities from the EU market: beef, palm oil, timber, coffee, cocoa, rubber and soy.
The co-legislators set the cut-off date of the new rules as 31 December 2020, meaning that only products that have been produced on land that has not been subject to deforestation or forest degradation after 31 December 2020 will be allowed on the Union market or to be exported.
Businesses of all sizes that trade in the selected products will have to meet stringent due-diligence obligations that trace the products they are selling back to the plot of land where it was produced. The European Commission will establish a bench-marking system which ranks countries according to their risk of deforestation: low, standard and high. While no country or commodity will be banned, companies placing products on the EU market will be obliged to demonstrate that their supply chains are not contributing to deforestation. They can use satellite monitoring tools, field audits, capacity building of suppliers or isotope testing to check where products come from.
Farmers will be required to prove that any beef sold on the EU single market, including in Northern Ireland, has not come from cattle raised on land that was deforested to make space for grazing. They will also have to demonstrate they are not using animal feed that contains soy or palm oil that is driving deforestation abroad.
However, the traceability requirements are unclear and there remains many questions over what information is required and lack of definitions which have not been answered.
Copa Cogeca stated that: "The focus must now shift to addressing the practical challenges associated with the EUDR’s implementation to prevent uncertainties and avoid supply chain disruptions. We will carefully review the guidance document published today and remain committed to further dialogue to ensure workable solutions for all impacted sectors.