On May 31st, 2023, the European Union adopted the new Regulation concerning the placing on the Union market and the export from the Union of certain raw materials and products associated with deforestation and forest degradation.
 

The Regulation lays down rules for the placing on and placing on the Union market, as well as for export from the Union, products containing, fed or processed using raw materials such as cattle, cocoa, coffee, oil palm, rubber, soya, and timber.

In that sense, this regulation seeks to promote deforestation-free supply chains. In addition, it considers the protection of human rights and the rights of indigenous peoples, local communities, and customary tenure rights holders.

Involving the supply chain, its effects are not limited to the territory of the Union but also apply to third countries, i.e., the regulation has extraterritorial effects.

Operators (which term means "any natural or legal person who, in the course of a commercial activity, places the relevant products on the market or exports them") are responsible for the conformity of the products they intend to place on the market or export through due diligence.

Traders (trader being defined as "any person in the supply chain other than the operator who, in the course of a commercial activity, markets the relevant products") are responsible for collecting and maintaining information that ensures the transparency of the supply chain of the products marketed by them.

All enterprises, including micro-enterprises, must report annually and publicly on their due diligence system and the measures taken to meet their obligations.

In short: only raw materials and products that are deforestation-free, produced in accordance with the relevant legislation, and covered by a due diligence declaration may be placed on the market, traded, or exported.