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Deforestation-free supply chains in force

The Regulation imposes a due diligence obligation on traders when they place on the EU market or export from the EU, inter alia, wood, leather and rubber and products made from them (such as furniture). Small businesses will benefit from a longer adjustment period.

As reported by the EU Commission, companies and traders in the EU now have 18 months from 29 June 2023 to adapt to new rules on deforestation-free supply chains. These took effect following approval by the European Parliament and the EU states. These rules aim to ensure that a range of goods placed on the EU market do not contribute to deforestation and forest degradation in the EU and elsewhere in the world.

The regulation is a central building block in the fight against climate change and the decline of biodiversity. It imposes a due diligence obligation on all companies concerned when placing the following goods on the EU market or exporting them from the EU: inter alia, wood, leather and rubber and products made from them (such as furniture). These commodities were selected on the basis of a thorough impact assessment that identified them as the main cause of deforestation due to agricultural expansion.

Traders must demonstrate that the products are both deforestation-free (i.e. produced on land that has not been deforested after 31 December 2020) and legal (in compliance with all relevant legislation in force in the country of production). Businesses will also be required to collect accurate geographical information on the agricultural land on which the products they purchased were produced so that they can be checked for compliance with all applicable regulations. The Member States must ensure that non-compliance leads to effective and deterrent sanctions.

The list of commodities documented is regularly reviewed and updated, taking into account new data such as changing deforestation patterns.

Small businesses will benefit from a longer adjustment period.

The Commission will establish a benchmarking system that assesses countries or parts thereof and their risk of deforestation and forest degradation – high, normal or low – taking into account the expansion of agriculture in the production of the seven commodities and their derived products. Obligations for companies depend on the level of risk involved. 

Jens Haasler will be pleased to answer your questions at beratung@trade-e-bility.de. Additional information on the topic of sustainability is available at https://www.trade-e-bility.com/services/supply-chains-sustainability

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