EUDR Regulation: Key information for compliance with the EU Deforestation Regulation

If there’s one thing that has become clear from the sustainability debate over the last few decades, it's that forests are much more than just a collection of trees. They provide a livelihood for about one-third of the world’s population. To protect them, the EU adopted the EU Deforestation Regulation (EUDR). The EUDR imposes much stricter compliance on companies importing certain goods into the EU. We explain how companies can meet their obligations under the EUDR Regulation.

EUDR Regulation: Key information for compliance with the EU Deforestation Regulation

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At a glance: Timings for the introduction of EUDR

EUDR was adopted on May 31, 2023¹, and officially entered into force on June 29, 2023. However, its application is phased to allow businesses adequate time to comply:

December 30, 2025: The regulation becomes applicable to large and medium-sized enterprises.
June 30, 2026: The regulation extends to small and micro-enterprises.

This phased approach ensures that companies of varying sizes can implement the necessary measures to meet EUDR requirements effectively.

Protecting what deserves protection

Forests are not only essential for regulating the climate, providing habitats for millions of animal and plant species, and supporting the water balance of entire regions, but they also provide a livelihood for about one-third of the world's population. Given their critical role in supporting diverse life forms, deforestation for agricultural purposes is an increasingly pressing threat.

According to the Food and Agriculture Organization of the United Nations (FAO), around 420 million hectares of forest have been lost worldwide over the past 30 years - an area larger than the European Union. Up to 90 percent of this deforestation is attributed to agriculture.² This trend not only significantly contributes to the climate crisis, but also threatens the livelihoods of indigenous peoples and local communities that directly depend on forests.

Against this backdrop, the European Union has introduced the EUDR Regulation, a framework to ensure that products consumed within the EU do not contribute to global deforestation and forest degradation.

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What is EU Regulation 2023/1115?

As mentioned above, the EU Deforestation Regulation (EUDR) was adopted on May 31, 2023, and regulates the trade, import and export of products that may contribute to global deforestation or be linked to illegal deforestation. Key drivers of this issue are palm oil, beef, soy, coffee, cocoa, rubber, timber, and processed products such as furniture, books, chocolate, and leather goods. The EUDR Regulation applies to all relevant products, whether imported into the EU or produced within the EU. Through enhanced traceability requirements, it aims to reduce the EU's contribution to global deforestation and forest degradation while protecting biodiversity. The EU expects that the EUDR will lead to a reduction in greenhouse gas emissions of at least 32 million tons per year.

Building on the EU Timber Regulation (EUTR), the EUDR Deforestation Regulation is part of the European Green Deal, which aims to promote a resource-efficient and competitive economy.

Meeting company requirements

The implementation of the EUDR Regulation is the responsibility of the national competent authorities designated by each country.³ For example, in Germany, the Bundesanstalt für Landwirtschaft und Ernährung (BLE) ensures that operators comply with the Regulation. In particular, the BLE monitors the obligations of companies and ensures that all provisions are correctly enforced.

However, as the requirements for sustainable practices become more stringent, many companies find themselves in a difficult position. On the one hand, they must, and in many cases desire, fulfill their responsibility to act sustainably. On the other hand, they face a significant bureaucratic burden associated with EU Regulations and other related measures. Especially the increasing demand for transparency and traceability throughout the supply chain presents companies with considerable challenges.

We explain how companies can meet the requirements of the EUDR Regulation and what steps they need to take to ensure compliance.

EUDR FAQs: the most important information at a glance

In order to properly comply with the requirements of the EUDR, there are three core principles that must be observed in accordance with Article 9 to ensure complete traceability.⁴

The three principles of regulation

Deforestation-free products

All products must come from land that has not been subject to deforestation or forest degradation since December 31, 2020.

Compliance with laws and human rights

Companies must demonstrate that their products comply with the relevant legislation of the country of production. This includes adherence to human rights and the rights of indigenous communities.

Mandatory due diligence declaration

When the EUDR Regulation comes into force, companies will have to submit a due diligence declaration via a central electronic platform before trading, exporting or importing goods.

Operators vs. distributors - who will be affected by the regulation and to what extent?

The due diligence obligations under the EUDR Regulation apply to both operators and distributors in the EU. Operators, i.e. companies introducing products to the EU market for the first time, take the main responsibility for fulfilling the due diligence requirements. They need to provide detailed documentation and information to ensure traceability throughout the supply chain. Distributors selling products already on the EU market have fewer obligations. Their main responsibility is to ensure that the required due diligence declarations from operators are available and can be provided on request.

Small and medium-sized enterprises (SMEs) enjoy some exemptions, such as the ability to use a reference number to refer to due diligence statements already submitted by other operators. However, SMEs will also have to comply with the EUDR Regulation from 30 June 2026 to ensure a level playing field. This phased compliance timeline provides smaller businesses with additional time to align with EUDR requirements.

Different countries, different risks - how is deforestation risk determined?

The scope of the due diligence obligations is determined by a benchmarking system developed by the European Commission, which ranks countries according to their deforestation risk. Depending on the level of risk, due diligence requirements vary: For products from low-risk countries, simplified procedures apply, where only basic information needs to be collected and submitted. For high-risk areas, however, more stringent requirements apply: If the product comes from a country with a higher risk of deforestation, or if there are indications of violations, companies must carry out a more comprehensive risk assessment under the EUDR Regulation. If a non-negligible risk is identified, companies are required to take mitigation measures.

The due diligence declaration - how does the process work?

Through the mandatory declarations, companies ensure that their products do not pose a risk to forests and comply with the EUDR. The process will generally be as follows:

It begins with the collection of information such as geo-location data, documentation on the origin of the product, production timeline and quantity. The EUDR Regulation also requires companies to provide information on the country of production and compliance with local laws.
Companies then carry out a risk assessment to determine whether the product meets the EUDR requirements. They must document how and by what criteria the information collected was assessed for potential risks.
If a risk is identified, companies must implement appropriate risk mitigation measures to ensure that the risk becomes negligible before the product is placed on the market. These measures could include additional supplier inspections, external audits, further testing or switching to lower risk sources.

To collect the information required under the EUDR, companies can use tools such as satellite software.⁵ The declaration is submitted through the EU’s central information system, the Deforestation Due Diligence Statement Registry.⁶

Specialist support for EUDR compliance

Having a licensed and qualified customs service provider on your side makes navigating the new EUDR regulation much easier. Providers such as Rhenus are well prepared to assist customers with the correct classification of products and documentation processes in line with EUDR requirements. This includes HS classification of goods, ensuring they are correctly declared and categorized. Relying on professional support can be a key advantage in customs clearance, ensuring compliance with both the EUDR and other international trade regulations. The broad scope of the EUDR also means that taking preventative measures, such as streamlining processes or improving transparency, is essential to avoid potential disruptions to logistics operations. Again, professional logistics and customs experts can provide clarity.

Another important aspect is segregation during transport. While the EUDR does not require physical segregation of goods during transit, it is recommended that there is a clear distinction between compliant and non-compliant products to avoid the risk of shipments being rejected for non-compliance. A reliable customs partner can also be invaluable in managing this aspect efficiently.

Perfectly prepared

Recently, it has been made public that the EU is considering giving companies a further year to prepare for the EUDR Regulation.⁷ A decision on this is expected in the coming weeks. However, one thing is certain: the requirements of the EUDR Regulation will come sooner or later and with them all the benefits for forests and global ecosystems, but also all the hurdles for companies that have to comply with the regulations.

In the meantime, it is advisable for companies to prepare, carefully checking whether your goods are covered by the regulation. This can be done by consulting the regulation’s annexes, which list the relevant customs headings. If your products are affected, prepare by gathering necessary compliance documentation and conducting a systematic review of product origins and production methods. In addition, the customs reference numbers should always be available so that they can be presented to the customs authorities in accordance with the regulation before the goods are imported or exported.

With the help of logistics providers with extensive customs expertise, precautions can be taken to increase the transparency of supply chains and thus be able to react to potentially stricter guidelines such as the EUDR regulation at any time. This makes it much easier for companies to combine sophisticated processes and responsible practices.

Are you looking for a logistics partner who is always one step ahead, even with new customs formalities such as the EUDR regulation?

Find out more about customs services that perfectly combine compliance and efficient supply chains.

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1 Source: https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=CELEX%3A32023R1115

2 Source: https://www.europarl.europa.eu/news/de/press-room/20220909IPR40140/klimawandel-neue-regeln-sollen-entwaldung-durch-eu-konsum-weltweit-verringern

3 List of competent authorities: https://circabc.europa.eu/ui/group/34861680-e799-4d7c-bbad-da83c45da458/library/b52a6d25-e365-4301-a90a-59cf7ce2e8d3/details?download=true

4 Source: https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=CELEX%3A32023R1115&qid=1687867231461

5 Source: https://forest-observatory.ec.europa.eu/

6 Source: https://green-business.ec.europa.eu/deforestation-regulation-implementation/deforestation-due-diligence-registry_en

7 Source: https://ec.europa.eu/commission/presscorner/detail/en/ip_24_5009