Timber Legality Across the Globe – Looking Back at 2018 and Ahead to 2019

Australian Forest

Timber Legality Regulation Tightens Across the World

Australia

In 2018 the first illegal logging infringement notice was issued by Australia’s Department of Agriculture for non-compliance with due diligence requirements of Australia’s Illegal Logging Prohibition Act. A Queensland based importer was fined $12,600. The move signifies the end of the ‘soft-start-compliance period’ by the Australian authorities in Jan 2018.

South Korea

Revision to the 2012 Act on Sustainable Use of Timber makes South Korea the first East Asian market to issue mandatory legislation regulating the legality of imported and domestically produced timber and timber products. Unverified timber cannot be sold in South Korea and must be returned to the country of origin or destroyed. The Act is similar to the EU Timber Regulation in many ways however it does not prescribe a due diligence requirement on operators, rather it is based on pre-import controls. Importers must submit a declaration with evidence their imported timber is legal. The revised act was implemented in October 2018.


Ukrainian Timber Under Scrutiny

In 2018 an EarthSight’s investigation reported major concerns with the Ukrainian timber sector. After a two year probe, the non-profit reported 40% of EU imports of Ukrainian timber ‘harvested illegally’, suggesting some of the world’s largest timber mills are purchasing illegally sourced Ukrainian timber, and selling it on to Europe’s top high street retailers.


5 Years of the EUTR – The View from Germany

Representatives including those from Lidl, BLE and the Thünen Institute, came together in Hamburg last October to review the successes and failures of the first five years of the EU Timber Regulation.

Tobias König of Lidl pointed to the uneven EUTR practices across member states as an issue that must be addressed. He also suggested the classification of products under the EUTR doesn’t follow logic, with different coverage across very similar products.

Jörg Appel from BLE (German Federal Office for Agriculture and Food) stated operators in timber sectors have mostly familiarised themselves well with the EUTR, however around half of those in industries including furniture, paper and other composite material have no knowledge of the regulation.

In similar vein, Dr. Margret Köthke revealed a recent survey of German operators shows 33% of respondents did not know the EUTR (17% in the timber industry and 44% non-timber). These figures were worse amongst SMEs, with larger German companies being more aware.

In response to the discussion, Matthias Schwoerer from the German Food and Agriculture ministry (BMEL) emphasised the positive effect of the EUTR on the timber sector and large importers, influencing the procurement decisions of suppliers. Challenges remain of course, but he argues the next stages of implementation should focus on information campaigns, clearer guidelines to timber source countries which are higher risk and better data exchange between customs and the competent authorities.


EC’s EUTR Consultation Results

the-future-of-eutr-header

The European Commission published the results of its public consultation.  Respondents were broadly in favour of expanding the scope of the EUTR with printed material and seating considered the priority.

This could have major implications for the year ahead as the European Commission undergoes impact assessments ahead of expanding the product scope. Businesses once unaffected by the regulation could then require due diligence systems in the near future.


2019 – Brexit and the ‘UKTR’

While it is still not clear exactly what the outcome of the Brexit process will be, the UK government has so far consistently stated that a UK version of the EU Timber Regulation will be enforced as the UK leaves the EU. UK operators will still have to perform due diligence on their imported products, according to the existing criteria and enforced by the same UK Office for Product Safety & Standards. In a no-deal scenario, the UK will be considered a ‘third-country’ to the EU, just like the USA or China.

The UK Government advises accordingly:

“To continue to comply with the EUTR, EU and EEA businesses would be required to apply due diligence to imports from the UK. As a result, it is likely that UK-based exporters would need to provide relevant documentation about the source and legality of their timber exports to EU and EEA-based importers to enable their customers to meet their due diligence obligations under the EUTR.

These due diligence systems would vary business by business. The documents UK businesses should provide will need to allow EU importers of UK products to fulfill the due diligence requirements of the EUTR given above. EU and EEA businesses importing timber from the UK that is covered by a CITES import permit will not need to conduct due diligence”