Commodity traders face EU deforestation rules

Commodity traders face EU deforestation rules

Brussels, 10 November (Argus) — Traders of many agricultural commodities face additional compliance burdens when selling in the EU, with the European Commission likely to publish next week a proposal for a regulation aimed at minimising the risk of deforestation and forest degradation from products sold in the bloc.

A leaked draft shows that palm oil, soy, beef, timber including fuel wood and pellets, cocoa and coffee will be allowed for sale in the EU only if they are "deforestation-free" and have been produced in accordance with the laws and regulations of the country of origin. Operators have to exercise "due diligence" prior to selling the listed commodities and products, and the regulation also sets out a "due diligence system". Operators can mandate an authorised representative. Maize and rubber have been left out of the draft.

The commission wants member states to lay down a system of "effective, proportionate and dissuasive" penalties, which should include confiscation of relevant commodities or products and of revenues gained by the operator or trader. Commodities and products are listed by the EU combined nomenclature.