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Green Business

Will the Commission issue guidelines?  

The Commission is working on guidelines to elaborate on some of the aspects of the Regulation, notably on the definition of “agricultural use”, that will address issues related to agroforestry and agricultural land, certification, legality and on other aspects that are of interest to many stakeholders on the ground. These documents are planned to be published before the entry into application of the Regulation.

The Commission is also gathering inputs and promoting dialogue amongst stakeholders via the Multi-stakeholder platform on Protecting and Restoring the World’s Forests with a view to providing informal guidance on a number of issues. This document on Frequently Asked Questions already answers the most frequent questions received by the Commission from relevant stakeholders and will be updated over time. If needed, additional facilitation tools will be mobilised.

N.B: No additional guidelines are necessary to comply with the rules. The Commission aims to elaborate certain aspects to explain how the Regulation will work in practice, share best practice examples, etc.

Will the Commission issue commodity-specific guidelines?  

No. However, the Commission aims to put forward best practice examples, including in guidance documents, which will to some extent cover commodity-specific aspects.

What are the reporting obligations for operators?

Operators which are not SMEs will have to publicly report on their due diligence system annually. For those operators that are in the scope of Corporate Sustainability Reporting Directive (CSRD) and comply with EU Sustainability Reporting Standards (ESRS) in due time, is it sufficient to publish their report according to the requirements in CSRD? Or will there be additional reporting requirements?

The Regulation provides that when it comes to reporting obligations, operators falling also within the scope of other EU legislative instruments that lay down requirements regarding value chain due diligence may fulfil their reporting obligations under the Regulation by including the required information when reporting in the context of other EU legislative instruments (Article 12.3).

What is the EU Observatory on deforestation and forest degradation?

The Observatory will built on already existing monitoring tools, including Copernicus products and other publicly or privately available sources, to support the implementation of this Regulation by providing scientific evidence, including land cover maps on the cut-off date, regarding global deforestation and forest degradation and related trade. The use of these maps will not automatically ensure that the conditions of the Regulation are complied with, but will be a tool to help companies to ensure compliance with this Regulation, for example to assess the deforestation risk. Companies will still be obliged to carry out due diligence.

The EU  Observatory on deforestation and forest degradation will cover all forests worldwide, including European forests and will be developed in coherence with other ongoing EU policy developments such as the Forest Monitoring Law and upgrading and enhancement of the Forest Information System for Europe (FISE).

The primary purpose of reference maps produced by the EU Observatory will be to inform the risk assessment by operators/ traders and EU MS Competent Authorities (CAs). As such, reference maps will have the following features:

  • They will be non-mandatory. There will be no obligation compelling operators /traders (or CAs) to use the reference maps of EU Observatory to inform their risk assessment
  • They will be non-exclusive. Operators and traders (as well as CAs) may avail themselves of other maps that can be more granular or detailed than those made available by the Observatory. The regulation is not prescriptive on the modalities to inform the risk assessment. The Observatory is one of the many tools which will be available, and will be a tool that the Commission will offer free of charge
  • They will be non legally binding. Therefore, reference maps may made available by the EU Observatory may be used for risk assessment. However, the fact that geolocation provided falls within an area considered as forest does not automatically lead to conclusions of non-compliance. On the other hand, one should not assume that if geolocation falls outside an area considered as forest the shipment/commodity will not be checked (there can be random checks, and there may be other risk factors) or that the commodity will be automatically compliant (first, due to the absence of 100% accuracy, and second, because a deforestation-free commodity could anyway be illegal)

What constitutes high-risk, and how long can a suspension take place? 

Article 17 allows Competent Authorities to take immediate actions – including suspension - in situations that present high risk of non-compliance. What constitutes high-risk, and how long can the suspension take place?

Competent authorities may identify situations where relevant products present a high risk of being non-compliant with the requirements of the Regulation on the basis of different circumstances, including on the spot checks, the outcome of their risk analysis in their risk-based plans, or risks identified through the information system, or on the basis of information coming from another competent authority, substantiated concerns etc. In such cases, the competent authorities can introduce interim measures as defined in Article 23, including the suspension of placing or making available the product on the market. This suspension should end within three working days, or 72 hours in case of perishable products. However, the competent authority can come to the conclusion, based on checks carried out in this period of time, that the suspension should be extended by additional periods of three days to establish if the products is compliant with the Regulation.

How does the Regulation link to the EU Renewable Energy Directive?

The objectives of the Deforestation Regulation and the Renewable Energy Directive are complementary, as they both address the overarching objective of fighting climate change and biodiversity loss. Commodities and products that fall within the scope of both acts will be subject to requirements for general market access under the EUDR and for being accounted as renewable energy under the Renewable Energy Directive (RED). These requirements are compatible and mutually reinforcing. In the specific case of certification systems for low Indirect Land Use Change (ILUC) according to Commission Regulation (EU) 2019/807 supplementing Directive (EU) 2018/2001, these certification systems may also be used by operators and traders within their due diligence systems to obtain information required by the EUDR to meet some of the traceability and information requirements set out in its Article 9. As with any other certification system, their use is without prejudice to the legal responsibility and obligations under the EUDR for operators and traders to exercise due diligence.