The EU Deforestation Regulation (EUDR), adopted in April 2023, aims to reduce deforestation resulting from the import of products such as palm oil, soy, coffee, cocoa, timber, and rubber. Its implementation seeks to mitigate the negative impact of economic activities on forests, which have been degraded in an area larger than the European Union over recent decades. Products imported into the EU market must comply with the "deforestation-free" principle, meaning their production after December 30, 2020, could not lead to deforestation or forest degradation. However, the implementation of this regulation has been postponed to the end of 2025. Why?
Scope and Key Requirements
The EUDR applies to goods directly contributing to deforestation, such as cocoa, coffee, soy, palm oil, cattle, and timber, as well as derivative products, including chocolate, furniture, paper, and rubber items. Companies are required to:
The regulations aim to enhance supply chain transparency and ensure that products available in the EU market comply with environmental standards.
Differentiation of Responsibilities
The EUDR divides entities into two categories:
- Operators placing products on the EU market – fully responsible for ensuring compliance.
- Traders – involved in the resale of products already available on the market
Every product introduced to the EU market must meet regulatory requirements, regardless of its origin or the location of the economic activity.
EUDR covers various groups of raw materials, including rubber, soy, coffee, palm oil and chocolate
Delay and Its Causes
Originally, the regulations were to come into effect in December 2024. However, the European Commission, responding to challenges raised by member states, businesses, and international organizations, postponed their implementation by one year. The new deadlines are December 2025 for large companies and June 2026 for small and medium-sized enterprises (SMEs).
Reasons for the delay include:
Challenges in preparing IT systems and benchmarks.
Legislative issues in defining supervisory authorities and penalties for non-compliance.
Concerns from companies about the costs and bureaucracy associated with implementing the new requirements.
IMPACT OF THE DELAY
The postponement provides companies with additional time to adapt to the regulations but delays the effectiveness of environmental protection measures. Introducing these rules requires enterprises to adjust technologies and procedures, which may be particularly challenging for SMEs. Critics of the delay include environmental organizations and certain political groups, which argue that these actions should be prioritized in combating the climate crisis.
One significant challenge is the lack of adequate communication about the EUDR among businesses. Many entrepreneurs are unaware of the upcoming requirements, which could hinder their preparation. Intensive information and educational campaigns are needed to raise awareness in the private sector.
Nevertheless, a portal has been launched to enable registration in the system, which is ultimately intended for submitting reports required by the Regulation.
tO SUM UP...
The EUDR is a significant step in combating global deforestation and protecting biodiversity. While the postponement of the regulation’s implementation may facilitate companies' adaptation, it also delays the realization of environmental outcomes.
Despite legislative and bureaucratic challenges, the European Union remains determined to introduce changes that reduce the environmental impact of economic activities on forests. In the long term, the EUDR can contribute to greater accountability in global supply chains, but it requires effective collaboration between member states, businesses, and supervisory authorities.
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