EUDR: Ensuring Deforestation-Free Paper Products in the EU  

The European Union Regulation on Deforestation-free Products (EUDR) marks a significant milestone in the EU's ongoing efforts to combat deforestation and forest degradation globally. This regulation replaces the EU Timber Regulation, extending the mandatory due diligence requirements to cover a broader range of commodities. The EUDR entered into force on 29 June 2023, with a transition period for compliance of 18 months.  
 
UPM is aware of the EU Deforestation Regulation (EUDR) requirements and is in full preparation to ensure the compliance by 30th December 2024. The aim of the regulation is to secure that the use of forests as a raw material is transparent throughout the value chain and that the forest is used in a responsible way. At UPM, we are deeply committed to sustainable forestry practices, and we support the regulation’s overall targets.  
 
EUDR imposes also requirements on businesses, such as due diligence and risk assessments as well as ensuring the information flow in the value chain. To align with the EUDR, UPM paper businesses have a dedicated project team for a comprehensive assessment of our operations from sourcing to the customer end to meet all regulatory requirements and to ensure that the required data is available to our customers within the required timeframes subject to the delivery of the final instructions by the EU Commission.  

EUDR: What Does It Mean?  

Under the new regulation, it is prohibited to place or make available on the EU market, or to export from the EU, any relevant commodities or products made using such commodities unless they meet the following criteria:

Deforestation and Forest Degradation-Free

Compliance with Country Legislation

Due Diligence Statement

 

UPM Papers' Commitment to EUDR Compliance  

At UPM Papers (UPM Communication Papers & UPM Specialty Papers) the commitment to sustainable sourcing and production is of utmost importance. As a key leader in the paper industry, UPM Papers ensures that all its products comply with the EUDR requirements through a rigorous due diligence process.  

    • The process begins with the suppliers of wood or other relevant commodities. They provide the initial DDS, including geolocation data, and receive associated reference numbers. 
    • Before placing its products on the market, UPM Papers will submit a DDS incorporating these reference (REF) numbers to the EU Information System Traces.  
    • After submitting the DDS, UPM Papers receives a unique reference number generated by the system, which is then forwarded to customers when the products are placed on the market.  
    • The process also involves verifying due diligence statements from suppliers and that, its suppliers have adequate due diligence systems in place, ensuring traceability and compliance across the supply chain.  

Recognizing the obligations set forth by the EUDR, UPM Papers are proactively preparing for full compliance by December 30. During this transition period, the company is taking necessary measures, such as:  

    • Engaging with Suppliers and Customers: Actively collaborating with suppliers, customers, and competent authorities to share information and ensure a seamless transition to the new regulation. 
    • Implementing Compliance Measures: Adapting internal processes and systems to meet EUDR requirements effectively. 

 

Please seek out for guidance from the EU directly or from a third party when determining the full impact of the regulation to your business activities.

 

 

Frequently asked questions on EUDR 

The information in this section is from publicly available EU sources and UPM's interpretation. Kindly note that UPM does not offer advice on EUDR compliance. This section will be updated according to available information (current update 2.7.2024).

Why is EUDR implemented?

On 29 June 2023, the Regulation on deforestation-free products entered into force. The main driver of these processes is the expansion of agricultural land that is linked to the production of commodities like cattle, wood, cocoa, soy, palm oil, coffee, rubber, and some of their derived products. As a major economy and consumer of these commodities linked to deforestation and forest degradation, the EU is partly responsible for this problem and it wants to lead the way to solving it. 

Does EUDR apply only to wood and paper originating from or processed in the EU?

Under the Regulation, any operator or trader who places these commodities ( cattle, wood, cocoa, soy, palm oil, coffee, rubber, and some of their derived products) on the EU market, or exports from it, must be able to prove that the products do not originate from recently deforested land or have contributed to forest degradation. The new rules apply if you place on the EU market or export from the EU. The regulation applies for any quantity of product, large or small. Products produced inside the EU are subject to the same requirements as products produced outside the EU. The Regulation applies to products listed in Annex I, whether there are produced in the EU or imported.

Where to find information if my product is in the scope of the regulation?

EUDR applies only to products listed in Annex I of the Regulation.

Is recycled paper in the scope of the regulation as a raw material?

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. 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.

What is the difference between EUTR and EUDR?

EUDR will replace the EU Timber Regulation (EUTR). The transition from EUTR to EUDR marks an evolution in the EU’s approach to combatting deforestation, expanding its scope from timber to a broader range of commodities and their derivatives, and enhancing requirements for transparency and traceability.

Are the requirements different for low risk countries?

A benchmarking system operated by the Commission will classify countries or areas into three risk categories according to the risk of producing commodities there that are not deforestation-free. 

There is no exception for the traceability requirement via geolocation. The operators also have to assess the complexity of the relevant supply chain and the risk of circumvention of the Regulation and the risk of mixing with products of unknown origin or origin in high-risk or standard-risk countries or parts thereof.

Country risk assessment will be based on an objective and transparent assessment analysis of quantitative and qualitative criteria, taking into account the latest scientific evidence, internationally recognised sources, and information verified on the ground. The system and list of countries, or parts thereof, will be published no later than 18 months after the entry into force of the Regulation.

Who is the supervising authority regarding EUDR?

You can find the list of competent authorities per Member State here:

List of competent authorities per Member State

For goods imported to EU or exported from EU, the customs is the authority checking the compliance.

What are the penalties for non-compliance?

Penalties for non-compliance shall be proportionate and dissuasive and the maximum fine must be at least 4% of the total annual turnover in the EU of the non-compliant operator or trader. As well a temporary prohibition against selling relevant products on or exporting them from the EU market, confiscation of the relevant products concerned and confiscation of revenues gained from a transaction with products concerned and temporary prohibition from public procurement processes and access to public funding for up to 12 months for serious or repeated infringements.

Will there be a standard interface to exchange the reference number data?

Under the new regulation, operators are required to submit their due diligence statements to the EU’s Traces online platform, and will receive EUDR reference numbers in return. Reference numbers can then be passed on to customers. EU is currently developing an Application Programming Interface (API) to enable the process of entering due diligence statements into the Traces system to be automated. Each company is responsible to develop their own systems in order to exchange with EU Traces system. 

How do you ensure you are compliant with the relevant legislation of the country of production?

"Relevant legislation" may include, among others, national laws and jurisprudence as well as international law as applicable in domestic law. The Regulation presents a non-exhaustive list of legislative areas without specifying particular legal acts, as these differ from country to country and may be subject to amendments. The Commission will issue a specific guidance document on legality in due course.

Can paper bought as forest certified paper replace some of the due diligence?  

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.

Will the reference number show the wood species and forest sources?

No, the reference numbers do not contain information visible for the next step in the value chain.

Will the reference number be provided for every lot of production and customer purchase?

UPM Paper Business inted to deliver the reference number per production run from the European mills. In one delivery there might be several reference numbers. UPM Paper Businesses deliver the reference numbers with the delivery note.

Have you got any experiences working with API in EU TRACES system?

UPM was one of the European companies that participated to the piloting of the EU TRACES system earlier this year and was able to provide feedback on the functionalities. In May the technical specifications of API were published and during the summer further guidance is expected from the Commission.

Will EUDR timeline be delayed?

There have  been rumors circulating on the delay of the timeline, however the only publicly communicated EUDR timeline is that the entry into application of the Regulation for large and medium enterprises is on 30th December 2024 and this is the timeline that UPM is looking at in its preparation for the Regulation.

Does the wood harvested or pulp/paper produced befor 30.12.2024 need to be compliant with EUDR?

The entry into application for large and medium enterprise operators is 30 December 2024 and they do not have to comply with the requirements for products placed on the Union market before that date. However if the end product is the first step in the value chain entering the EU, this compliance timeline might differ.

 

Read more on EU's official website on Regulation on Deforestation-free products