EUDR Gap Analysis
Evaluate information provided by the company to identify potential gaps of the company's Due Diligence System with EUDR by means of document reviews, interviews, site visit (if applicable).
ABOUT EUDR GAP ANALYSIS
The Gap Analysis service covers not only services to operators or traders within the EU but also to Organizations located outside of the EU which do not place the timber directly on the EU market. Such Organizations may request the service, for to enhance the confidence to their clients about their supplied products.
CHALLENGES
The Regulation 2023/1115 of the European Parliament and of the Council of 31 May 2023 (EUDR) is a regulation that applies across 27 European Union Member States to guarantee that the products EU citizens consume do not contribute to deforestation or forest degradation under the Regulation. Any operator or trader who places these commodities on the EU market, or exports from it, must be able to prove that the products:
- deforestation-free;
- have been produced in accordance with the relevant legislation of the country of production; and
- are covered by a due diligence statement.
STRENGTHS AND BENEFITS
- Risk Identification: The gap analysis services allows companies to identify and address potential gaps before procurement and production. This helps in mitigating risks during placing relevant commodities and relevant products on the EU market or export from it.
- Optimize preparation: The gap analysis services help companies enhance confidence before procurement and production by assessing the company's due diligence system to correspond with EUDR-related requirements. This ensures that you are fully prepared and take the necessary steps to meet EU regulation.
- Cost and Time Savings: Identifying and addressing weak area early on through the gap analysis service can save companies costs and time. It allows you to rectify any deficiencies or gaps in your due diligence system before procurement and production, thereby reducing the cost of re-production or shipping penalties.
TARGET USERS
Operators and traders who provide the relevant commodities and products entering or leaving the EU market.
Q1. When does it enter into force and into application?
The Regulation was published in the Official Journal of the European Union on 9 June 2023. It entered into force on 29 June 2023. However, the applicability of certain Articles listed in paragraph 2 of Article 38 will enter into application on 30 December 2024 (18 months transition) and on 30 June 2025 (24 months transition) for micro- and small enterprises.
Q2. What about the period between these dates? Will the products placed on the Union market between the entry into force of the Regulation and its date(s) of applicability have to comply with the requirements of the Regulation?
The entry into application for large and medium enterprise operators and traders is foreseen 18 months after the entry into force of the Regulation (on 30 December 2024). This means that operators and traders do not have to comply with the requirements for products placed on the Union market before that date. For small- and micro undertakings this period is extended (24 months after the entry into force of the Regulation - on 30 June 2025).
Q3. How does the regulation apply to exports?
The Regulation applies both to exports and to imports. Operators exporting relevant products will have to include the reference number of the due diligence statement in their export declaration. Operators exporting products made with commodities that were already covered by a due diligence statement may also avail themselves of relevant simplifications in article 4.
Q4. Are there obligations for non-EU countries?
There are no legal obligations applicable to non-EU countries. This Regulation sets out obligations for operators and traders (see chapter 2 of the Regulation) as well as for the EU member states and their competent authorities (see chapter 3 of the Regulation).
However, many countries around the world have taken action to enhance deforestation-free supply chains, strengthen public traceability systems on relevant commodities, etc., thereby facilitating the tasks of companies under this Regulation. This is welcome, as such developments can greatly help operators and traders to comply with their obligations.
Q5. What products are included in the Regulation?
The Regulation applies only to products listed in Annex I. Products not included in Annex I are not subject to the requirements of the Regulation, even if they contain relevant commodities in the scope of the Regulation. For example, soap will not be covered by the Regulation, even if it contains palm oil. Likewise, products with an HS code not included in Annex I, but which might include components or elements derived from commodities covered by the Regulation – such as cars with leather seats or natural rubber tyres – are not subject to the requirements of the Regulation.
Q6. What is the ‘date or time range of production’?
Operators (and traders that are not SMEs) are required to collect information on the date or time range of production under the obligations set out in Article 9 of the Regulation. This information is needed to establish whether the relevant product is deforestation-free. That is why it applies to the commodities covered by the Regulation that are placed on the market or to the commodities that are used for the production of relevant products covered by the Regulation.
Q7. What does ‘plot of land’ mean?
The "plot of land" – the subject of geolocation under the Regulation – is defined in Article 2 (27) as "land within a single real estate property, as recognised by the law of the country of production, which possesses sufficiently homogeneous conditions to allow an evaluation of the aggregate level of risk of deforestation and forest degradation associated with relevant commodities produced on that land."
Q8. How does the regulation apply to wood used for packaging?
For example, in the case of a producer selling packaging to manufacturers (to protect the final product - not to be sold as a final product to consumers), the text "not including packaging material used exclusively as packaging material to support, protect or carry another product placed on the market" in Annex I under Wood HS code 4415 should be understood as follows: If any of the concerned packaging is placed on the market or exported as a product in its own right (i.e. standalone packaging), rather than as packaging for another product, it is covered by the Regulation and therefore due diligence requirements apply.
If packaging, as classified under HS code 4415, is used to ‘support, protect or carry’ another product, it is not covered by the Regulation.
Packaging material used exclusively as packaging material to support, protect or carry another product placed on the market is not a relevant product within the meaning of Annex I of the Regulation, regardless of the HS code under which they fall.
User manuals accompanying shipments are also falling under this exemption unless they are purchased in their own right.
Q9. Does all recycled paper/paperboard fall under the scope?
Most recycled paper/paperboard products contain a small percentage of virgin pulp or pre-consumer recycled paper (for example, discarded paperboard scraps from cardboard box production) to strengthen the fibres.
Annex I states that the Regulation does not apply to goods if they are produced entirely from material that has completed its lifecycle and would otherwise have been discarded as waste as defined in Article 3, point (1), of Directive 2008/98/EC. So, no obligation applies under the Regulation in respect of the recycled material.
On the contrary, if the product contains a percentage of non-recycled material, then it is subject to the requirements of the Regulation and the non-recycled material will need to be traced back to the plot of origin via geolocation.
Q10. What is the role of certification or verification schemes?
Certification schemes can be used by supply chain members to help their risk assessment to the extent the certification covers the information needed to comply with their obligations under the Regulation. Operators and traders which are not SMEs will still be required to exercise due diligence and they will remain responsible for any breach.
Not applicable.
