THE CHAOS & RACE TO THE EUDR DEADLINE!


The ‘burning’ question…of EUDR!


There is a new piece of European Union legislation that will come into effect at the end of this year… which will have a major effect on a number of commodity markets. The Regulation is already having a major effect on some of these markets… right now…in the run up to its formal operation.


Let’s start with what EUDR stands for. It is the EU Deforestation Regulation and is seen as an important turning point in the global fight against deforestation. As a Regulation, it effectively came into force on the 29th


of June 20231


related to the Regulation will come into force on the 30th


to all products harvested from the 29th


of December 2024 and will be applicable of June


2023, imported into or exported from the European Union, with further different dates applicable, dependant on business size. Companies had been given, 18 months to prepare and implement the new Regulation(s), micro and small enterprises are allowed a longer adoption period2


. Crucially, the


first implementation date for the new Rules of the Regulation will be the 30th


of December 2024 and


will apply to ‘large’ businesses. Large businesses will be subject to checks, fines and potential bans from the EU marketplace should they fail to meet the requirements of the Regulation. Some parts are already effectively in operation. Going forward, companies will have to conduct due diligence confirming that affected products have not


1 www.eastasiaforum.org, 20th 2 www.thelandbankinggroup.com


October 2023


been sourced from land which was deforested or degraded after the 31st


of December 20203 . EUDR


also replaces and supersedes the earlier EU Timber Regulation (‘EUTR’) with 3 key differences. EUDR is broader in the range of commodities than EUTR, earlier due diligence will now be more stringent, transparent, traceable and includes geolocation proof and finally, it goes further than just combating illegal logging by addressing deforestation, forest degradation and the legality of practices used.


. The new Rules


SO…WHAT ARE THE COMMODITIES THAT FALL UNDER THIS NEW REGULATION? They fall into two categories, deforestation free and deforestation & degradation free. For the first category, these will include the following: Cocoa, Coffee, Soy, Palm Oil, Cattle & Beef plus Rubber and all the products of these. In the second category, for the moment, this only has wood and wood products3


. When considering the ‘products’, these


will include such derivatives as chocolate, leather, furniture, charcoal and printed paper…there is an extensive annex covering all these4


.


The impact of EUDR, will be immediate, with companies that have EU operations undertaking obligations as operators and/or traders whilst companies outside the EU but with customers in the EU, will need to supply data to help them comply with EUDR3


.


COCOA RISING…


3 www.uk.fsc.org 4 www.eur-lex.europa.eu


5 | ADMISI - The Ghost In The Machine | Q1 Edition 2024


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