Provisional agreement in trialogue on EU regulation on deforestation-free products

An article by Franziska Rau

In the early hours of 6 December 2022, the three EU institutions - the Council, the European Parliament and the European Commission - succeeded in reaching provisional agreement in the so-called trialogue on the key points of an ambitious and implementable EU regulation on deforestation-free products. The regulation aims to ensure that agricultural commodities consumed in the EU have not led to deforestation or forest degradation in the country of production after 2020. To this end, companies must fulfil due diligence obligations. In addition, the European Commission will classify the deforestation risk of production countries and thus ensure more transparency.  

According to the preliminary trialogue agreement, the regulation will also be extended to natural rubber, charcoal, printed matter and some palm oil derivatives - in addition to the current scope, which includes soy, beef, palm oil, cocoa, coffee and wood, as well as certain products made from them, such as leather, chocolate and furniture. Human rights aspects are anchored by the principle of free, prior and informed consent (FPIC) of indigenous peoples. Companies must know and declare the exact place of production of the relevant agricultural commodities. In addition, control quotas by the competent authorities of the member states of 1% for low-risk production countries, 3% for standard risk and 9% for high risk are introduced. Fines are thus to amount to at least 4% of EU-wide turnover and may also include temporary exclusion from public procurement. The extension of the regulation to other forested areas and to the financial sector will be considered in the coming years. The definition of degradation includes the conversion of primary forests and naturally regenerating forests into plantation forest or other forested land. 

The agreement in detail can also be found in this press release from the Council.

Now, on the way to the commencement of the regulation at the end of 2024, after an 18-month transition phase, only the formal passing in the Environment Council and the European Parliament at the beginning of 2023 remains. The agreement in the Trilogue under the Czech Council Presidency was reached extremely quickly - just over a year after the European Commission presented its legislative proposal in mid-November 2021. This reflects the high priority of forest conservation and minimising agricultural deforestation for combating climate change and species extinction. After all, around 90% of deforestation is due to agricultural expansion. The EU is the second largest import market after China for deforestation-driven agricultural commodities, e.g. palm oil, soy, cocoa, coffee or natural rubber.