The UN Food and Agriculture Organization (FAO) estimates that 420 million hectares of forest — an area larger than the EU — were lost to deforestation between 1990 and 2020. EU consumption represents around 10% of global deforestation.
Following COP 15 (the UN’s Biodiversity conference) in December 2022, members of the European Parliament reached a preliminary deal with EU governments on a new law on deforestation-free products that will make it obligatory for companies to verify and issue a so-called “due diligence” statement that goods placed on the EU market have not led to deforestation anywhere in the world after 31 December 2020. The products in the new legislation include coffee.
Recently adopted, the regulation will require businesses to collect the geographic coordinates of the land where the commodities they place on the market were produced. This strict traceability is meant to ensure that only deforestation-free products enter the EU market.
According to the provisional text, companies will not be allowed to sell their products in the EU without this type of due diligence. Companies will also have to verify compliance with the producing country’s relevant legislation, including their legislation on human rights and the rights of indigenous peoples.
What will the impact be?
It will require all importers to issue a due diligence statement in order to sell products on the EU market. According to Pascal Canfin, the chairman of the European Parliament’s environment committee, companies “will be required to have a certificate, based on satellite images and GPS coordinates to know exactly where the commodity comes from”.
He stated on 6th December, “When you arrive on the EU’s internal market…you must show this certificate. And if you don’t have it, you can’t go in …The amount of inspections carried out will depend on the country of production, with the most high-risk countries seeing 9% of operators and traders trading products checked [at port]”.
Imports will need proof that they have looked at baseline satellite imagery and intelligence from no later than December 31, 2020 and the matching intelligence from current time and can confirm that no deforestation is detected.
Both the Fair Trade Advocacy Office and INA (Initiative for Sustainable Agricultural Supply Chains) are reporting that polygon mapping will be a requirement in the new regulations for any farm over 4 hectares. Unlike a single GPS point, a polygon provides the entire perimeter of the production area.
Additionally, this new regulation includes human rights protection due diligence. Companies will have to verify compliance with the country of production’s laws, including human rights and the rights of Indigenous Peoples. This relies on the law of the country of production, which may vary in stringency.
When will this happen?
“The law will enter into force 20 days after its formal adoption by the European Parliament and EU countries, expected [in Spring], but will not apply to big and medium sized companies until 18 months and micro and small companies for 24 months”.[Source]
As of the 19th ofApril, the European Parliament has formally adopted the regulation and it is anticipated that the EU member states will individually adopt the regulation soon thereafter. Assuming that the EU member states adopt the regulation shortly, we can expect it to be enforced as early as late 2024.
Further reading and useful resources
Summary of the incoming regulation:
A factsheet from the European council:
https://ec.europa.eu/commission/presscorner/detail/en/ip_22_7444
Useful article on the most recent adoption phase:
