(3 Minutes Read)
The European Union Deforestation Regulation (EUDR) is set to bring a major shift in global supply chains, especially for businesses dealing with commodities linked to deforestation. Effective from December 30, 2025, large and medium-sized companies must ensure their products are deforestation-free to be sold in or exported from the EU, while small and micro-enterprises have until June 30, 2026 to comply.
The EUDR prohibits the import and export of goods associated with deforestation or forest degradation that occurred after December 31, 2020. To meet the requirements, products must be deforestation-free, legally produced according to the local laws of origin, and supported by a due diligence statement. This regulation covers not just physical imports and exports but also online sales, and it replaces the EU Timber Regulation with a broader scope, now encompassing several global commodities.
The regulation specifically targets seven key commodities: cocoa, coffee, palm oil, soy, beef, rubber, and wood—though only for specific product types listed in Annex I of the EUDR. For instance, palm oil used in soap might be exempt unless explicitly mentioned. Both operators—those bringing products into or exporting them from the EU—and traders—those distributing goods within the EU—are required to comply. All businesses involved must ensure that their products meet legal, environmental, and traceability standards.
To achieve compliance, companies must follow a structured due diligence process. This involves three key steps: accessing information to prove products are deforestation-free, conducting risk assessments to identify any potential non-compliance, and mitigating risks by taking corrective action where necessary. An online Due Diligence Statement Registry has been introduced to streamline the submission and management of compliance documentation. Although companies sourcing from low-risk regions face reduced obligations, they are still required to perform due diligence.
Failure to comply with the EUDR will lead to strict enforcement by national authorities in each EU member state. Penalties for non-compliance include fines of at least 4% of EU turnover, confiscation of non-compliant goods and profits, exclusion from public procurement for up to one year, and potential market bans for repeat violations.
With deadlines fast approaching, businesses are urged to act now by mapping their supply chains, engaging with suppliers, and establishing traceability systems. A Forbes report indicates that only 30% of upstream and 12% of downstream suppliers currently have traceability in place. Sectors such as coffee and rubber, which often depend on smallholder farmers, face particular challenges due to their complex and fragmented supply chains.
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https://trendsnafrica.com/rainforest-alliance-mitigate-deforestation-and-enable-eudr-compliance/
Ultimately, the EUDR represents more than just a regulatory hurdle—it’s a significant move toward promoting sustainable and transparent global trade. Companies that prepare proactively not only ensure continued access to the EU market but also position themselves as leaders in responsible sourcing and long-term supply chain resilience.