On 29 June 2023, Deforestation-free Products Regulation ((EU) 2023/1115) entered into force with the aim of minimising the EU’s contribution to deforestation and forest degradation worldwide. Combating deforestation and forest degradation constitutes an important part of the package of measures needed to reduce greenhouse gas emissions and global biodiversity loss.
The new rules will affect the entire supply chains. Specifically, the rules will apply to operators and traders (natural or legal persons) who place, make available or export forest-risk commodities (cattle, cocoa, coffee, palm oil, rubber, soya and wood) and products that contain, have been fed with or have been made using these commodities, such as palm nuts, leather, chocolate or furniture.
The Regulation requires operators and traders to implement due diligence system. In practice, it means that they will have to ensure not only that the commodities and products they are supplying have been produced in accordance with the laws of the country of production, but also that they are 'deforestation-free' (i.e. notfrom land that has been deforested or subject to 'forest degradation' since 31 December 2020).
The operators and traders will need to ensure access to information on the supply chains; undertake a risk assessment; take mitigation measures and submit a statement through a European information system confirming that they have successfully exercised due diligence. However, SMEs are governed by less stringent regime.
The Regulation also establishes a benchmarking system, which assigns a level of risk related to deforestation to countries within and outside the EU. Obligations for operators, traders and authorities will depend on the level of risk.
The principal requirements will apply to large and medium-sized enterprises from 30 December 2024 and to smaller enterprises in relation to most products from 30 June 2025.