New Commission’s Proposal: Explained

At the end of September, the Commission published a letter to the Parliament proposing a one-year delay in the EUDR due to technical issues in the EU Information System, TRACES. The reasons put forward were that the large data load could cause the system to slow down or suffer from frequent disruptions, with serious repercussions on trade flows, and that security could not be guaranteed.

Many companies and NGOs have opposed this proposal, urging the EU institutions not to stop EUDR, but to keep the application date while postponing the start of the audits from the competent authorities.

When the EU Commission published the proposed amendments to the EUDR’s official text on October 21, 2025, it seemed that it had taken into consideration part of the feedback received. The combination of the suggested amendments introduces structural changes and new simplifications to the Regulation’s requirements, while managing to overcome TRACES’s technical limits.

In the next chapters, we will analyse and evaluate the proposed changes and their impact on the affected companies.

Stronger Distinction Between Primary And Downstream Operators

The distinction between upstream and downstream operators has been introduced by the fourth version of FAQs and the Guidelines Document issued in April 2025. In the official text, operators were a single category, in contrast with “traders”. Now, the official text frames companies in three main groups:

Primary Operators: Micro & Small Enterprises Vs. Medium & Large Companies

An important structural change is the qualification of micro and small primary operators as a separate category. The original text differentiated the requirements for large companies on one side, and for SMEs on the other side, including micro-, small-, and medium-sized companies. Now, the distinction is between micro and small enterprises vs. medium and large companies.

Under paragraph 15a of Article 2, micro and small primary operators are defined as a natural person or a micro- or small-sized undertaking that is based in a low-risk country. In addition, such an enterprise must have “grown, harvested, obtained from or raised on relevant plots of land, or, as regards cattle, on establishments” the relevant products. Based on the EU Commission’s official press release, this definition covers almost 100% of the farmers and foresters acting in the European territory.

Please note that the definition states that such companies must be “based in a low-risk country”, which is different from companies sourcing from a low-risk country as mentioned in the country benchmarking system. In this second case, the low-risk country is indeed the country of production of the raw materials.

Essentially, as all countries in Europe are deemed “low-risk”, a micro or small company based in a European low-risk country and sourcing from standard- or even high-risk countries is still considered part of this category.

A Simplified Regime for Micro and Small Primary Operators

Micro and small primary operators are exonerated from conducting a full due diligence and from submitting the due diligence statement to TRACES. However, they are still required to submit to TRACES a simplified declaration that displays all information reported in Annex III.

This declaration is a one-time document that must be provided before placing the products in the market. TRACES will not return reference and verification codes, but instead a “declaration identifier”.

Micro and small primary operatorswill still be required to include geolocation data, but they can do so by using the postal address of all relevant land plots, or establishments in case of cattle, instead of coordinates via GeoJSON files.

In addition, if Member States already manage country-based databases with the set of information required in the simplified declarations, they can make the data available in TRACES on behalf of the micro and small primary operators.

The Requirements For Medium And Large Enterprises

The original text mandated that SMEs would need to conduct full due diligence and submit the DDS to TRACES, along with the larger companies. However, if micro and small primary operators can benefit from the simplified regime, the new text does not offer the same simplification to the medium-sized companies.

Large and medium-sized companies will retain the same requirements, including full due diligence through application of Articles 9, 10, and 11 (Data Collection, Risk Assessment, and Risk Mitigation), and the DDS submission to TRACES. They must also pass the DDS reference and verification numbers to the downstream operators and traders.

No DDS Submission For Downstream Operators & Traders

Over the last 12 months, obligations of downstream operators and traders that are not SMEs have already been subject to several attempts to cut their complexity. For instance, in the fourth version of the FAQs and new Guideline Document published in April 2025, the EU extended to the downstream operators and traders the simplification provided to SME operators, which consists of the possibility to reference past DDS instead of conducting full due diligence (Article 4, para. 8, 9, and 10).

Now, the obligation has been cancelled, with the new text deleting the related paragraphs completely, including the provision that companies in this category remain liable in case of breach of the Regulation.

The EU Commission is trying to exclude them almost completely from the Regulation’s administrative burden, independently of their size. According to Article 5 of the amended official text, downstream operators and traders are no longer required to submit a DDS referencing all DDS numbers received. They should instead collect and store a set of information about their Tier 1 suppliers and their business partner to whom they sell the relevant products.

The list of the necessary information is below:

• the name, registered trade name or registered trade mark,
• the postal address,
• the email address and, if available, a web address.
• In addition, they must collect and store the reference numbers of the due diligence statements or the declaration identifiers associated with the relevant products, and pass them on to the next business partner along the supply chain.

These were exactly the requirements for SME traders (Article 5, para. 3 of the original text).

Another new provision introduced by the proposal is that they are no longer obliged to verify the validity of the DDS numbers received from their suppliers, as they are no longer held liable in case of breach of the Regulation by companies upstream. The reason might be traced back to the fact that the verifications would still rely on the same system, and the simplification is indeed an attempt to reduce the system’s requirements.

However, in case of suspicion that the products are not compliant, only non-SME downstream operators and non-SME traders must notify the competent authorities. In case the situation raises ‘substantiated concerns’, these companies must also verify that the due diligence took place and that the DDS displayed a “no risk” or “negligible risk” result.

EUDR Postponement & Grace Period

Concerning the timeline of the EUDR application, the new official text confirmed that the EUDR will start applying to large and medium primary operators, downstream operators, and traders from December 30, 2025.

On the other side, one of the most important implications is indeed the postponement of EUDR for micro and small companies, for which the date of application is postponed from June 30, 2026, to December 30, 2026. Given that the requirements changed extensively, although they got simplified, it makes sense that the EU would allow extra time to prepare and implement the necessary processes.

But the news doesn’t stop there. The EU wants to grant a grace period of 6 months to medium and large primary operators, downstream operators, and traders, during which no audits or checks will be carried out by the competent authorities. The aim is to let the companies try out the system and adjust their business to the new compliance process. And only then start verifying whether the requirements have been respected.

The checks will be conducted after June 30, 2026, over medium and large companies, and after December 30, 2026, over micro and small companies.

The Transition Plan From EUTR to EUDR

Along with the EUDR timeline modification, the proposal sorted out the transition from the EU Timber Regulation (EUTR) to the EU Deforestation Regulation.

There are two main indications. For mid and large companies, the general rule provides that EUDR will replace EUTR from December 30, 2025. The exceptions are:

• With the harvest date before June 29, 2023, and the date of placing in the market from December 30, 2025: EUTR applies until December 31, 2028, then EUDR will replace it.
• With the harvest date before June 29, 2023, and the date of placing in the market from December 31, 2028: EUDR applies right away.

But what if timber and timber products were harvested after June 29, 2023? Apparently, the general rule prevails, with EUDR applying from December 30, 2025.

For micro and small companies, instead, the general rule provides that EUDR will replace EUTR from December 30, 2026. The exception is:

• With the harvest date before June 29, 2023, and the date of placing in the market from December 30, 2026: EUTR applies until December 31, 2028, then EUDR will replace it.

The transition from EUTR to EUDR will create some confusion, but with clarity and detailed guidance, it will be easily achieved. The instructions contained in the proposal lack both, but the visual scheme prepared below might help in understanding them.