EU Answers Businesses' Cry for Help with New EUDR Assistant

Regulations, regulations, regulations. As the world gets warmer, the oceans rise higher and the weather grows more unpredictable, one thing is for sure: regulations are going to get stronger.

Without top-down intervention to enshrine sustainability in law, climate change will likely roll on completely unfettered. The European Union assents to this notion and as such is imminently launching one of the most stringent pieces of sustainability legislation ever: the EU Deforestation Regulation (EUDR).

This ground breaking regulation will prohibit the import or export of any products made via deforestation, from foods to furniture.

Due to relentless lobbying and logistical issues, the enforcement of the EUDR has been pushed back until 2025. In response to this setback, the EU has redoubled its efforts to streamline the process by introducing a new data tool for affected businesses to use.

Introducing... the Deforestation Due Diligence Statement Registry. This online repository is going to be pivotal in aiding companies' adherence to the EUDR. 

So, how exactly will this new system work? Companies — from operators to traders — will utilise this registry to submit electronic Due Diligence Statements (DDS) to the relevant authorities. This documentation will certify that their products align with the stringent sustainability criteria outlined in the EUDR.

The platform is not just a simple registry; it boasts a variety of tools designed to ease the compliance process. Among its features are interactive map-based tools to pinpoint product origins, facilities for bulk uploading of geolocation data, and also a dashboard to monitor the progression of DDS submissions.

It doesn’t end there — for businesses managing large-scale operations, it supports API connections for seamless data exchange, enhancing efficiency substantially. With some luck, this should alleviate the pressure on the companies that were struggling to get their affairs in order.

The purpose of the EUDR

The EUDR, a component of a broader EU initiative showcased at this initiative, takes aim at deforestation practices primarily driven by the production of commodities such as cocoa, rubber and palm oil.

By regulating these practices, the EU targets to minimise its indirect deforestation impacts globally — aligning it with other crucial EU policies such as the European Green Deal and the Farm to Fork Strategy. It envisions cutting carbon emissions by approximately 32 million metric tonnes annually, directly supporting the EU's climate and nature conservation agendas.

This new regulatory framework expands upon the baseline set by the EU Timber Regulation by covering not just illegal logging activities but also ensuring broader due diligence practices in the traceability of supply chains linked to deforestation.

The regulation hence demands transparency and environmental accountability across global supply chains, heavily impacting large industry players as well as gradually imposing new standards on smaller entities.

Simplifying compliance

The Deforestation Due Diligence Statement Registry offers operators and traders alike the ability to submit their DDS, prove product traceability and verify non-involvement with deforestation. It's a well-equipped system, complete with map-based tools that allow users to delineate sourcing areas and handle geolocation coordinates smoothly.

Among its many features, users can specify detailed product characteristics like volume and origin, which should go some distance to managing data. Best of all, the system is said to offer users data that is trackable in real time, meaning that measurements should be possible to a pretty high level of accuracy.

The system's API connectivity is particularly beneficial for large-scale operations, enabling automated submission processes which save time and reduce manual input. For example, OPTEL’s Optchain software integrates seamlessly with the registry, offering comprehensive solutions including traceability and AI-driven risk assessments aimed at mitigating deforestation risks efficiently.

Moreover, platforms like Prewave enhance compliance via AI, automating supplier engagement and leveraging data analytics to monitor real-time supply chain dynamics.

The challenges and the outlook

However, the EUDR does pose challenges, particularly for smaller suppliers and farmers — voiced by Dr Chandra Silori, Deputy Executive Director of RECOFTC. He says: "We see this regulation as promising for reducing deforestation and forest degradation … but there are many challenges on how these will be applied on the ground, especially for smallholders."

These entities may well struggle with the demands of detailed geolocation data and proving legal compliance, which could heighten their operational difficulties and cost implications.

Similarly, Ann Nachtergaele, Food Production & Consumption Director of Fevia, has some concerns about the rollout of the registry.

She says “The European registration system will not be available until mid-December. This can have consequences on the availability of certain raw materials and their price as large companies are then obliged to send questionnaires to the many small companies, which quickly become overwhelmed.”

Nevertheless, the EUDR is seen by some industry experts as a proactive step towards setting stringent standards for supply chain transparency and sustainability, positioning the EU as a leader in fostering global environmental responsibility.

Whatever one's view on the regulation, one thing is certain; the months and years ahead will be fraught with challenges and change. As such, the tools used to manage this transition will be nothing short of crucial.

Make sure you check out the latest edition of Sustainability Magazine and also sign up to our global conference series - Sustainability LIVE 2024

Sustainability Magazine is a BizClik brand