The EU Deforestation Regulation (EUDR) imposes specific requirements on companies that import, produce, or sell certain raw materials. To ensure compliance with these requirements, it is essential to understand the details of the EUDR. Below are key points.
EUDR – A short introduction
The EU Deforestation Regulation (EUDR) is an important milestone in protecting the world’s forests and combat deforestation and forest degradation. The regulation requires businesses to ensure that the raw materials they trade are sourced legally and sustainably. The raw materials the EU aims to ensure are sourced legally and sustainably include coffee, cocoa, soy, palm oil, cattle, plantation wood fiber, and plantation rubber.
The EU adopted the EUDR on December 6, 2022, and will come into effect, at the end of 2025. Deforestation is one of the major causes of climate change and biodiversity loss—two of the most pressing environmental challenges we face today.
EUDR – clarification of traceability and due diligence
Since the introduction of the EUDR, 10 significant changes have been made under the category of “traceability and due diligence,” which all businesses should be aware of.
- Bulk Goods and Composite Products (1.3)
Bulk goods: For products such as soy or palm oil, operators must ensure that all involved areas are identified and that raw materials are not mixed with products of unknown origin or from deforested or degraded areas. This means that traceability to the specific area is crucial.
Composite products: For items like wooden furniture, which consist of different wood components, the operator must geolocate all areas where the raw materials were produced.
Products with multiple raw materials: If a product contains several relevant raw materials (e.g. a chocolate bar with cocoa, cocoa butter, and palm oil), due diligence is only required for the primary raw material (in this case, cocoa).
- Plot size and homogeneous conditions (1.7)
There is no fixed minimum or maximum size for areas, as long as the area accurately captures the production zone and has sufficiently homogeneous conditions to assess the risk of deforestation and forest degradation.
- Geolocation via polygons or points (1.8)
For areas under four hectares, geolocation can be described with a single latitude and longitude point. For cattle, only a few geolocation points are required for all the establishments where the cattle have been kept.
- Digital formatting of polygons (1.9)
The detailed rules for the functionality of the information system will be established through an implementing act. Where possible, the information system will facilitate operators’ work by allowing commonly used digital geolocation formats to be uploaded directly into the system when declaring polygons in a due diligence statement.
- Production on part of a property (1.15)
If a relevant raw material is only produced on part of a larger property, the operator must only specify the geolocation for the specific area where the raw material was produced. If legal deforestation occurs in another area of the property, it does not affect compliance for the raw material produced in the approved area, unless the legal status of the entire property is impacted by illegal activities.
- Mixing of Goods (1.17)
The operator must specify the production site for all goods actually shipped to the EU. If approved goods from different production sites are mixed in the same silo, the production site must include all goods that have entered the silo since it was last empty.
- Indicating Too Many Areas (1.18)
If operators specify more areas than necessary, they must still perform full due diligence for all specified areas and demonstrate that the risk of non-compliance is negligible.
- Inspections in Third Countries (1.21)
Authorities can conduct inspections in third countries, provided these countries consent through cooperation with administrative authorities.
- Production Date or Period (1.25)
Operators must collect information on the production date or period to determine whether the product is “deforestation-free.” For raw materials other than cattle, the production date refers to the harvest date, while the production period refers to the duration of the production process.
- Compliance of the directive (1.31)
Raw materials can only be marketed in the EU if they are produced in accordance with the relevant legislation in the country of production. Compliance with the EUDR requires a thorough understanding of both EU legislation and national laws in the production country.
Stay Updated with prduct.com
With the updated points, a clear picture of “traceability” and due diligence is provided. This clear picture highlights how crucial it is for businesses to navigate the EUDR and ensure compliance with the regulation. The EUDR is complex, and its many requirements can seem overwhelming. Therefore, businesses are advised to seek guidance and stay updated to navigate the regulation’s details correctly.
Prduct.com offers a solution that simplifies EUDR compliance. We help you keep track of your HS codes and ensure compliance through automated and reliable data processing. In short: We collect your data, conduct risk assessments of your entire supply chain, and help minimize identified risks.
