NYHETER

EU pushes back Deforestation-free product deadline: More time for businesses to comply

On 16 October 2024, the European Union has taken further steps to extend the timeline for implementing a key piece of environmental legislation, the Deforestation Regulation (EU) 2023/1115. This extension is important for giving all stakeholders affected by the regulation more time to prepare. The new deadlines are:

  • Large enterprises and traders: 30 December 2025
  • Small and micro-enterprises: 30 June 2026

This extension allows businesses and governments to develop and implement comprehensive due diligence systems, identify and mitigate deforestation risks, and establish monitoring and reporting procedures.  Despite the delay, the fundamental aim of the regulation remains unchanged. The EU remains committed to reducing its impact on deforestation and forest degradation globally, ensuring that products placed on or exported from the EU market are produced in a sustainable manner.

The regulation is seen as a critical tool for promoting environmental sustainability and enhancing the EU’s role in global efforts to protect forests.

Background
Adopted on 31 May 2023, the regulation addresses global deforestation driven by agricultural expansion. Commodities like soy, palm oil, and coffee, which significantly contribute to deforestation, are targeted. The EU, a major consumer of these products, aims to influence global supply chains towards sustainability.

The regulation ensures that products containing listed commodities, sold or exported within the EU, do not contribute to deforestation post-31 December 2020. Businesses must establish stringent due diligence systems to verify their products are deforestation-free before entering the EU market or being exported, including:

  • Information Requirements:Collecting detailed supply chain data, including geolocation coordinates of production plots.
  • Risk Assessments:Identifying and assessing deforestation risks associated with the commodities.
  • Risk Mitigation Measures:Implementing actions to mitigate identified risks, ensuring no or negligible risk of non-compliance.

Additionally, businesses must submit due diligence statements through an information system managed by the European Commission. Traders, especially large enterprises, must maintain high transparency within their supply chains and promptly address substantiated concerns from interested parties to ensure continuous compliance with the regulation.

Postponement and Industry Impact
Originally, these rules were set to take effect from 30 December 2024. However, after feedback from EU Member States, third countries, traders, and operators, concerns were raised that the industry would struggle to meet the strict requirements in time. In response, the EU Council agreed to postpone the enforcement date by 12 months.

For businesses, the postponement offers critical time to develop compliance systems and invest in tracing supply chains. In the long term, this regulation is expected to shift global supply chains towards more sustainable practices, particularly for commodities linked to deforestation.

For more details, check the official Commission proposal here.

by: Bobby Arash