As the world’s largest trading bloc, the European Union (EU) is a primary consumer of agricultural commodities. This includes commodities grown in tropical countries such as palm oil, timber, cocoa and coffee. However, EU’s ever-growing demand for food, feed, fuels and biomass has led to increased production of these commodities, resulting in an expansion of agricultural land globally. This global expansion for agricultural commodities has been identified as the main driver for deforestation and forest degradation globally.  

Recognising its impacts on deforestation globally due to its market demands, the EU Commission has proposed a Regulation in 2021 to minimise EU-driven deforestation and forest degradation. This was later legislated in the form of the EU Deforestation Free Regulation (EUDR), which entered into force on 29 June 2023. This regulation is part of EU’s Green Deal objectives, which outlines its ambitions to be climate neutral by 2050. Compliance starts on 1st January 2025.  

The complete EUDR document can be found here: Regulation - 2023/1115 - EN - EUR-Lex (europa.eu) 

EUDR aims at minimizing EU consumption of commodities and products coming from supply chains associated with deforestation or forest degradation, and increasing the EU demand for and trade in legal and deforestation-free commodities and products.  

• Minimising EU’s contribution to deforestation and forest degradation worldwide, in order to reduce greenhouse gas (GHG) emissions and biodiversity loss, especially endangered species. 

• Minimising deforestation and forest degradation risk of products from supply chains associated with deforestation and forest degradation entering the EU market. 

• Increasing demand for deforestation-free and legal commodities and products in EU 

Seven commodities are affected, namely palm oil, cattle, cocoa, coffee, soy, timber, rubber and the commodities’ derivatives. The list of commodities here will be regularly reviewed and updated, taking into account new data such as changing deforestation patterns.  

However, the EU has informed that "the exact list of products is to be found in Annex I. Products not included in Annex I are not subject to the requirements of the Regulation, even if they contain relevant commodities in the scope of the Regulation. For example, soap will not be covered by the Regulation, even if it contains palm oil".  

To verify if the said product is affected by the EUDR, refer to the list of products and its Customs Code in the Annex I below: 

Source: EU 

More information on the EUDR scope can be found here: Scope - European Commission (europa.eu) 

These are the key EUDR requirements that would impact both operators and producers alike: 

• Article 3 (Prohibition), which requires commodities and relevant products to be deforestation-free, legally produced and covered by a due diligence statement. 

• Article 8 (Due Diligence) stipulates that EU operators and traders placing relevant products on the EU market will need declare through a due diligence statement that their products entering the EU are both deforestation-free (produced on land that has not been subject to deforestation after 31 December 2020) and legal (produced in accordance with the relevant legislation of the country of production).  

• Article 9 (Information Requirement) which requires supply chain traceability and transparency, including geographical information on the commodities source of origin. There is an obligation to precisely provide the geo-location of the plot of land involved in the production/farming of the products & commodities for each shipment, to ensure that these products can be traced back to its areas of origin, and verified if it meets the EUDR requirements. 

• Article 29 (Assessment of Countries), where the Country Benchmarking System will assess producing countries / parts thereof’s level of risk of deforestation and forest degradation to be either “High-Risk”, “Standard Risk” or “Low-Risk”. “High-Risk” countries will be subjected to higher frequency of audit checks by Competent Authorities, and more due diligence efforts by operators and traders. 

More information of the operators obligations can be found here: Due Diligence - European Commission (europa.eu) 

More information on the Country Benchmarking can be found here: Benchmarking & Partnerships - European Commission (europa.eu) 

Entry of products linked to deforestation will be prohibited and all products linked to deforestation will be withdrawn if they are already present on the EU market. Fines will be imposed a minimum of 4% of the annual turnover of the operator in the EU. 

EU operators and traders placing relevant products on the EU market will need to comply with the new rules as of 30 December 2024, while EU SMEs will have six additional months (by 30 June 2025). 

EU’s official FAQ site on EUDR can be found here: https://green-business.ec.europa.eu/deforestation-regulation-implementation_en#frequently-asked-questions