How to Comply With the EUDR

The EU Deforestation Regulation (EUDR) requires companies trading in cattle, cocoa, coffee, oil palm, rubber, soy, wood, and derived products to implement due diligence measures ensuring their supply chains are free from deforestation, forest degradation, and local law violations since 31 December 2020.

Starting 30 December 2025 (or 30 June 2026 for smaller companies), only products classified as "deforestation-free" and compliant with local laws may be imported or exported to the EU. Companies within its scope must identify, prevent, and mitigate respective risks across their operations and supply chains.

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Deforestation Regulation, The Implications for SMEs

Comprehensive Due Diligence Requirements

Companies must gather extensive supply chain data, including geolocation of raw material origins, assess risks, and mitigate them as necessary. All due diligence declarations and product details must be submitted digitally through an EU portal, creating traceable reference numbers shared across the supply chain.

Impact on SME Traders and Manufacturers

SMEs importing relevant products from non-EU countries must ensure full supply chain transparency, submit due diligence statements, and generate reference numbers. SME traders or manufacturers who source and/or transform products within the EU are required to collect and share EUDR reference numbers for all goods traded or used.

Strict Monitoring and Accountability

National authorities will conduct regular and surprise inspections. Non-compliance can lead to severe penalties, including fines up to 4% of EU turnover, product seizures, exclusion from public contracts, and even trade bans for repeat offenders. Private parties can also take legal action if violations are overlooked.

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