On 21 August 2025, the United States and the European Union issued a “Joint Stat…
The European Regulation on the making available on the Union market and the export from the Union of certain commodities and products associated with deforestation and forest degradation.
Regulation (EU) 2023/1115, known as “EUDR”, entered into force on 29 June 2023 and will apply from 30 December 2025 for most operators (30 June 2026 for micro and small undertakings).
The legislation aims to minimize global deforestation and forest degradation, reduce greenhouse gas emissions, and protect biodiversity. In addition to environmental objectives, the EUDR integrates social considerations, requiring compliance with the legislation of the country of production, including land use rights, forest-related rules, human rights, and indigenous peoples’ laws.
It should be noted that this is a sectoral regulation compared to the “horizontal” framework provided for in the field of “due diligence” by Directive 2024/1760 on corporate sustainability due diligence (the so-called “CSDDD”); therefore, in case of conflict, the EUDR prevails over the CSDDD.
Recently, the European Commission published (in OJ C of 12 August 2025) a new guidance document (C/2025/4524), aimed at clarifying the provisions of the EUDR (hereinafter, the “Communication”). The Communication – which is not legally binding – provides operational indications on key aspects such as the differences between the obligations of various operators, due diligence, the submission of the due diligence statement (“DDS”), the role of certifications, and the timing of the EUDR’s entry into force.
The scope of the EUDR covers seven commodities considered at risk: cattle, cocoa, coffee, palm oil, soy, wood, and natural rubber, as well as numerous derived products listed in Annex I, including leather, chocolate, paper, furniture, and pneumatic tyres.
The EUDR applies in particular to operators and traders, distinguishing between SMEs and non-SMEs. In short, the operator is the one who first places a relevant product on the EU market or exports it, while the trader is the one who makes it available on the market after the initial placing.
Non-SME operators must implement a three-step structured due diligence process: collection of detailed product information (description, quantity, country of production, geolocation of plots of land, supplier and buyer data, proof of compliance); risk assessment of possible non-compliance, considering elements e.g. the assignment of risk to the relevant country of production, prevalence of deforestation or forest degradation in the country of production, the complexity of the relevant supply chain, and risk of mixing with products of unknown origin; and, if necessary, adoption of mitigation measures to reduce the risk to a negligible or zero level, such as requests for additional information or independent audits.
A positive conclusion of the due diligence process is possible only if the residual risk is zero or negligible. Otherwise, the product cannot be placed on the market or exported.
Operators must submit the DDS through the Information System provided for in Article 33 and keep the related documentation for at least five years.
They are also required to set up an internal due diligence system, with formalized procedures and controls, as well as a periodic review (at least annually).
It should be pointed out that the EUDR provides for a classification of countries of origin based on risk level: low, standard, or high. Generally speaking, for low-risk countries, operators may apply simplified due diligence, limited to collecting basic information and submitting the DDS, without in-depth assessment and mitigation. For high-risk countries, on the other hand, checks and inspections are more stringent and frequent.
Competent authorities carry out documentary and physical checks, including at customs. In case of non-compliance, corrective measures may be adopted, such as immediate withdrawal or recall of products, donation for charitable purposes, or disposal. Sanctions may amount to at least 4% of the annual turnover achieved in the EU, in addition to confiscation of products or revenues, temporary exclusion from public procurement and public funds, and, in the most serious cases or in case of repeat offences, temporary prohibition from placing or exporting relevant commodities and products.
The Communication acknowledges the usefulness of voluntary environmental certifications; however, these may supplement – but not replace – mandatory due diligence. In particular, certifications based on mass balance models or mixed product percentages do not in themselves guarantee compliance with the EUDR. Only products fully compliant with legality and zero-deforestation criteria in all their components may be placed on the EU market. The operator must therefore verify the certifications’ compliance with the EUDR.
To prepare for the 30 December 2025 deadline, companies should implement as soon as possible a series of actions: mapping their supply chains, identifying suppliers and risk areas; establishing a centralized database for information management; as well as adapting supply contracts with specific clauses on compliance with the EUDR.
It is also essential to train the staff involved, particularly in the purchasing, quality, and sustainability departments, and to implement a structured internal due diligence system. Finally, it is essential to maintain constant monitoring of regulatory developments and best practices, to ensure timely compliance and prevent legal and reputational risks.
