On April 19th, the European Parliament aproved a Regulation concerning the importation to the EU space of products assotiated with “deforestation and forest degradation”, aiming to reduce worlwide deforestation, the emission of greenhouse gases and the loss of biodiversity”.
The measure will have a significative impact in the Brazilian agrobusiness exportation sector, coming into force on the 20th day after publication and a large part of the diploma will be enforceable 18 months after.
The companies operating in the European single market will have to assure that the relevant products or commodities sold are not related to deflorestation (conversion of forest to agricultural use after 12/31/2020) or forest degradation (conversion of forest to plantation forests or wooded land, or conversion of primary forests to planted forests after 12/31/2020), were produce according to the legislation of the country of origin (namely, related to human rights and affected indigenous people rights) and are covered by a due diligence statement.
The due diligence statement, among others, must include:
– the country and region of origin of the products and the geolocation of the plots of land and datas where and when they were produced, as well as to testify that the region of origin could be legally used to that purpose;
– risk assessment measures, detering the placement of non complying products, among other elements considering the presence of indigenous people in the area of production (with duly reasoned claims regarding them); the prevalence of deforestation or forest degradation; the level of corruption, lack of law enforcment and violations of human rights; the difficulties/impossibility of connecting products and origin or the provenance where deforestation or forest degradation has occurred;
– risk mitigation measures.
Among the products addressed by the Regulation one can find:
– cattle (live cattle, fresh or frozen meat or prepared subproducts, leather);
– cocoa (beans, paste, butter, chocolate) and coffee (grain or ground);
– soya (beans, flour or oil);
– wood (unnaloyed, charcoal, transformed) and rubber (natural or tranformed).
The infringment of the rules will determine the immediate removal or recollection of the product, its donation to charity or its elimination.
Lingering the default, the faulty company can be sanctioned with a fine equivalent to 4% of its annual business volume; the confiscation of the products or the trading revenues; the temporary exclusion up to 1 year from public procurement processes and access to public funding; the temporary prohibition from placing relevant commodities and products, or the reinforcment of the due diligen demands.
The sanctiond compamies will be featuring in a Eurppean Comission list.
To prepare your company to comply with the new legal framework, CONTACT ETIC!
