A law passed by the European Parliament requires companies working in cattle, cocoa, coffee, palm oil, rubber, soy and wood to demonstrate their products aren’t sourced to deforested land or land with forest degradation, or else risk heavy fines.Companies will have to submit “due diligence” reports showing they took proper steps to verify the origins of their products while also complying with countries’ local regulations on human rights and impacts on Indigenous people.Critics say the legislation may still lack the teeth to prevent deforestation, especially if political pressure from traders forces EU countries to overlook their noncompliance with the new regulations. The European Union is one step closer to adopting landmark regulations that hold companies accountable for ensuring their products don’t contribute to deforestation.
A new law, passed with an overwhelming majority by the European Parliament, requires companies to demonstrate their products aren’t sourced to deforested land or land with forest degradation, or else risk heavy fines. It needs the endorsement of the European Council to enter into force.
“This is great news for the Indigenous people and wildlife who depend on standing forests for their survival, but also for consumers who have been telling governments and companies that they don’t want to dine on deforestation,” said Alex Wijeratna, senior director at Mighty Earth, a climate advocacy group.
The law, officially called the European Deforestation Regulation (EUDR), targets cattle, cocoa, coffee, palm oil, rubber, soy and wood, as well as commodities that have been fed by or made using those products, such as leather, chocolate, printed paper and furniture.
Agriculture specifically is one of the largest drivers of deforestation globally. Around 420 million hectares (over 1 billion acres) of forest were cleared for agricultural use between 1990 and 2020, according to the FAO. Demand from the EU contributed to about 10% of that.
Deforestation in Indonesia. (Photo by Rhett A. Butler)
European residents have for years strongly backed increased environmental regulations on international trade. Recent polling showed over 80% of Europeans thought businesses should stop selling products that destroy forests, and that products driving deforestation should be banned.
“Until today, our supermarket shelves have all too often been filled with products covered in the ashes of burned-down rainforests and irreversibly destroyed ecosystems and which had wiped out the livelihoods of Indigenous people,” said parliament member Christophe Hansen. “All too often, this happened without consumers knowing about it. I am relieved that European consumers can now rest assured that they will no longer be unwittingly complicit in deforestation.”
The European Commission, which acts as one of the EU’s executive branches, proposed the law last December. Now that the European Parliament has passed it, the European Council needs to give its endorsement.
Under the new law, companies will have to submit “due diligence” reports showing they took proper steps to verify the origins of their products. They also have to show they’ve complied with a country’s local policies on human rights and impacts on Indigenous people.
The legislation will classify exporting countries based on their deforestation risk. Low-risk countries will have a simpler due diligence procedure while more high-risk countries will have to go through more rigorous checks.
The checks will make use of geolocation coordinates, satellite monitoring tools and DNA analysis that can trace product origins.
A felled tree in Gabon. (Photo by Rhett A. Butler)
Failure to comply with the new regulations will result in a fine of at least 4% of a company’s total annual turnover.
But critics of the law said this still might not be enough to stop deforestation. The law doesn’t include regulations on biomass imports such as the burning of wood pellets, which the EU considers carbon neutral despite contributing to significant forest loss. It also doesn’t include at-risk ecosystems that aren’t rainforests, such as Brazil’s Cerrado.
It’s also possible that country risk assessments won’t accurately reflect the situation on the ground, where deforestation is hard to trace and often hidden behind indirect buyers. There isn’t any guarantee that political pressure from traders won’t force European importers to overlook noncompliance with the new regulations, Human Rights Watch (HRW) pointed out.
“European agribusiness companies have made numerous voluntary commitments regarding their supply chains,” said HRW environment researcher Luciana Téllez Chávez, “but they have not eradicated deforestation and human rights abuses.”
Banner image: Deforestation in Indonesia. (Photo by Rhett A. Butler)
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