Highlights of the webinar:
The webinars in Brazilian Portuguese, English, French, and Spanish (click on the links for the slides) were attended by over 100 participants, including civil society from producer countries, as well as international NGOs and donors.
Most participants welcomed the proposals, but there was consensus that the regulatory proposals must:
- Go beyond focusing on legality and certification
- Prohibit all companies, no matter what size, from placing forest risk commodities on the EU and UK markets
- Include human rights due diligence
Additionally, participants raised the following concerns:
- There needs to be more support and guidance for small and medium enterprises and small-holders from producer countries to enable them to respond to the consultations and to be able to comply with due diligence regulation.
- The EU and UK needed to engage more with other buyer countries, like China and India, to adopt similar legislative proposals. If other buyer countries do not adopt similar legislation, there is a huge risk that products linked to deforestation are just diverted from the EU and UK markets to other buyer markets.
- There needs to be sufficient funding and mechanisms to support monitoring and enforcement.
- The UK proposal is too limited and must include human rights, financial institutions and needs to apply to all companies. The UK should have also offered translation services for their consultation, like the EU did, to enable stakeholders from producer countries to respond.
Frequently Asked Questions
1. Should the UK’s proposal focus on legality?
A focus on illegal deforestation is not enough to halt forest degradation and deforestation and to protect forest people’s rights. One of the participants mentioned that in Brazil, for instance, stakeholders can legally deforest and convert 88 million hectares (which is roughly four times the size of the UK and equivalent to 50 years of the UK’s 2019 emissions). In many countries, especially highly forested countries, national and local laws are too weak, legally allowing rampant deforestation. If the UK proposal were to become law, the UK would then allow products linked to legal deforestation on the UK market.
2. Are labelling and certification enough to prevent imported deforestation?
It was explained that NGOs in the EU/UK do not advocate for additional labelling. Labels put the burden on consumers instead of raising the bar for all and creating a legal level playing field which should be respected by all private sector actors. Regulations will oblige companies to put in place risk assessment systems requiring the development of adequate traceability systems.
Those pushing for certification fear that some countries’ legality standards would overlook human rights and environmental protection. The EU should therefore support producer countries to undertake stakeholder consultations to identify and address gaps in their current systems.
Concerns were raised that certification can’t sufficiently address human rights and financial institutions and that it would be cheaper for companies to pay fines than to comply with legal requirements.
Participants at the webinars agreed that certification is problematic, especially for the soy market. Deforestation requirements in current soy certification schemes are not satisfactory. In addition, there is little capacity and few resources to undertake tracing in these countries.
3. How will the EU and UK proposals be enforced?
The UK’s proposal would enable the Secretary of State to levy fines on businesses who do not comply. The enforcement measures in the EU would depend on which of the options they use to conduct due diligence.
Adequate law enforcement and monitoring are essential for any new regulation. The EU and the UK need to ensure that their legislations are robust and informed by other existing instruments such as the EU Timber Regulation (EUTR) and the Illegal, unreported and unregulated fishing (IUU) carding system. New tools such as an observatory could also be explored. Fern will publish a discussion paper about enforcement challenges and possible options, based on learning lessons from the EUTR and other legal tools. It is hoped this paper will contribute to further reflection and discussion. The EU and UK also need to support stakeholders from producer countries, to ensure that there are robust traceability systems that can determine whether a product has been linked to forest deforestation, forest degradation or human rights violations.
4. Have the EU and UK taken lessons learned from existing regulatory frameworks, such as the European Union Timber Regulation (EUTR)?
Yes, the EUTR is a model for the UK and the EU. The European Commission is conducting an EUTR fitness check to pinpoint lessons learned which are to be integrated in a new regulatory framework for all forest risk commodities.
5. How can the EU and UK better support small scale producers and Small and Medium Enterprises (SMEs)?
It is critical that small-holders’ and SMEs’ voices are heard. The EU and the UK should develop processes to get direct input from these stakeholders because they often do not have access or capacity to engage in these high-level technical consultations. One way to do so is by engaging with producer forest forums and other roundtables. Development cooperation could also support technical assistance to small-holders and SMEs to build their capacities.
6. Are the EU and the UK encouraging other buyer countries to adopt similar due diligence approaches?
Fern is pushing the EU and UK to have a stronger dialogue on deforestation with other countries importing forest risk commodities. The UK government is engaging with other importing countries and hopes to use their presidency of the 26th UN climate conference (COP26) to raise the ambitions for due diligence legislation worldwide. The EU is also exploring an EU-China dialogue on deforestation. It is important to note that there are already other proposals in other importing countries such as the US, which is similar to the UK proposal.
7. Should the proposals apply to all businesses or just large ones?
The proposals should target “all” businesses. Size is often not determinate of the amount of imported deforestation a business is linked to.
Some Member states opt to impose mandatory obligations only on companies of a certain size. This means only a small number of companies are obliged to comply. Under Organisation for Economic Cooperation and Development (OECD) guidance, all businesses should be included under the scope, although there would be differentiated responsibility according to their influence in the supply chain. Participants at the webinars agreed with this approach. Businesses themselves have stated several times that businesses of all sizes should be included, as there’s no reason to suggest that the size of the business represents how much deforestation it imports.
8. How will the UK decide whether a product is produced legally?
The UK government will define which producer-country laws will be included in the scope of the regulation. The laws included will have to pertain to all forest risk commodities (other than timber) and be relevant to forests or other important ecosystems.