Basic information

From January 1, 2025 (if the proposal for a 12-month postponement is approved, then from January 1, 2026), the EUDR regulation will govern trade in so-called relevant commodities (timber, coffee, cocoa, palm oil, rubber, soy, cattle).

These commodities are a major cause of global deforestation. The EU is a significant consumer of these commodities, and therefore aims to halt deforestation. For this reason, the EU is implementing the EUDR Regulation.

Postponement of Effectiveness - The EU Council has provisionally agreed in a trilogue with the European Parliament to postpone the entry into force of the deforestation regulation by one year without any changes to the content of the regulation. This step still needs to be formally approved by both institutions, which is likely to take place on 17 December 2024. The entire approval process must be completed by the end of this year. We will keep you informed about the situation.

What EUDR concerns

In the case of timber, it concerns relevant products that are placed on the EU market. This includes products with HS codes 44. A complete list can be found in Annex 1 of the EUDR Regulation, see the link below:

Nařízení - 2023/1115 - EN - EUR-Lex (europa.eu)

EUDR does not apply to rattan, bamboo, and recycled products.

Who EUDR Affects

The EUDR Regulation applies to all links in the supply chain, and each link bears responsibility for any violations of this Regulation.

This includes:

• Primary producers in the EU (forest owners)

• Importers

• Processors

• Traders who are neither small nor medium-sized enterprises

• Exporters

Obligations arising from EUDR

To demonstrate that the product placed on the EU market did not cause illegal deforestation, forest degradation, and that the laws of the producing country were not violated. This means exercising due diligence.

Due Diligence System

• Collect information such as description + name of the timber species, quantity, country of production, geolocation (geographical location of the land described by latitude and longitude coordinates, for plots larger than 4 ha marked by a polygon), date or time range of harvesting, information about the supply chain (who supplied the timber, to which trader the timber was supplied), and other information that shows the supplied timber did not cause deforestation and was produced in compliance with the legislation of the respective country.

• Verify and analyze the collected information. Assess whether there is a risk that the supplied timber does not comply with the EUDR.

• Mitigate identified risks to make them negligible (additional documentation, independent surveys, etc.).

Based on the conducted due diligence (in written form, so that it can be reviewed), all links in the chain are required to issue a so-called Due Diligence Statement in the EU information system known as Traces. Traces will then generate a reference number and a verification number for such a statement. Other entities in the supply chain can then refer to this reference number and do not need to perform the due diligence system again. Reference numbers from previous statements will be included in their due diligence statement.

Individuals or micro-enterprises can authorize an economic entity or trader at the next level of the supply chain to act as a proxy and submit the due diligence statement on their behalf. However, the responsibility for compliance of the relevant products remains with the micro-enterprise or individual. Wood & Paper a.s. will offer the service of a proxy representative to small suppliers and forest owners.

A template for the due diligence statement is included in Annex 2 of the EUDR Regulation, see the link below:

Nařízení - 2023/1115 - EN - EUR-Lex (europa.eu)

How the implementation of EUDR will look in practise?

Wood & Paper a.s. will use the Wood Accept information system to collect the necessary data.

Suppliers will enter the reference and verification numbers of their due diligence statements generated by the EU information system – Traces into Wood Accept at the moment of creating the delivery aviso. A delivery aviso without a reference and verification number cannot be accepted. If a supplier has the reference and verification numbers included in the quarterly contract, these numbers will be pre-filled in the intention.

Given that violations of the EUDR regulation carry significant and even devastating penalties, not only financial but also a ban on placing the product on the market, it is in the interest of all forest owners and other entities in the supply chain to cooperate in fulfilling the requirements of the EUDR.