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The EU Timber Regulation (EUTR) No 995/2010 of the European Parliament and of the Council of 20th October 2010 laying down the obligations of operators who place timber and timber products on the market 1 came into effect in all European Union Member States on 3rd March 2013.
The EUTR aims to close down markets for uncontrolled/illegal logging by ensuring that the EU imports only timber products that are produced in accordance with national laws of the originating country. It applies to
timber and timber-based products that are produced both within the EU and those that are imported into Member States from outside the EU.

EU Timber Regulation (EUTR) – an overview The EUTR regulates all EU businesses that trade in a wide range of timber and paper-related products to ensure that “only timber products which have been produced in accordance with the national legislation of the timberproducing country enter the Union”1.
Three documents represent the current official European Commission position in terms of EUTR interpretation and law enforcement:

  • Regulation (EU) No 995/2010 of the European Parliament and of the Council (EUTR)
  • Commission Implementing Regulation (EU) No. 607/2012 (2012)
  • Guidance Document for the EU Timber Regulation (2013)

How this affects your businesses

How your business is affected will depend upon your position in the product supply chain, the type of product you are trading in and its categorisation under the EUTR.
Traders and Operators
Companies supplying or trading in timber and paper related products fall into two definitions:

  • Operators – those who first place on the EU market the timber or timber products (whether sourced from within the EU or from outside the EU).
  • Traders – those who sell or buy timber or timber products already placed on the internal market by Operators or other Traders.

To “first place” products on the EU market means you are the entity with legal ownership of the product when it first enters the EU market.
For most Traders it has been business as usual since the law took effect on 3rd March 2013. As a Trader, your EUTR obligations extend to maintaining transaction records for 5 years and co-operating with any investigations that might arise in the future.
As an Operator you must take action to fulfil more indepth requirements to comply with EUTR. Operators have two due diligence options for all timber products placed on the EU market:

  • Establish and regularly evaluate a Due Diligence System (DDS) or
  • Use a DDS provided to you by a third party.

Due diligence
The EUTR requires Operators to implement and follow a Due Diligence System (DDS) for all timber and timberbased products. A DDS is a system to assess the risk of timber or a timber product being from an illegal source. Due to the product exceptions given by the EUTR, many companies have been selective in terms of applying a DDS, which can be a very difficult and time consuming exercise – particularly for highly processed products such as paper.

EUTR and the Implementing Act (No 607/2012) provide basic rules in terms of elements of the DDS process that can be broken down into three stages:

Stage 1. Access to information – The Operator is required to collect obligatory information about the product or product component: trade name, quantity, timber species, country of origin, supplier and client names, contact details and evidence of the product’s compliance with national legislation (as specified in EUTR Article 6a Due diligence systems).

Stage 2. Risk assessment – For the information gathered at stage one the Operator is required to risk assess the product and its origin (using criteria given by EUTR Article 6b Due diligence systems).

Stage 3. Risk mitigation – Steps taken by the Operator in case the risk assessment outcome is other than negligible or could not be specified at all. This may include calls for additional information, field audits or requests for third party verification/certification.

What you need to do

Establish if you are an Operator or a Trader, at product/transaction level.

  1. Check if the products or product components are covered by the EUTR.
  2. Check if the products are coming with CITES or FLEGT certificates.
  3. Establish the Due Diligence System (only where necessary).

 

For more information please contact us info@bmtrada.fi