Due Diligence Requirements to Tackle Deforestation: An overview of the EU and British proposals

The paper analyzes the EU's proposal for a regulation on deforestation-free products and the UK's Environment Act 2021, detailing their respective scopes, due diligence processes, and enforcement mechanisms while highlighting challenges related to WTO consistency and impacts on smallholders in developing countries.

• The European Commission's proposal aims to ensure that only deforestation-free products, produced according to the laws of the producing country and covered by a due diligence statement, are available in or exported from the EU market. The scope includes cattle, cocoa, coffee, palm oil, soya, and wood, as well as products derived from them.
• The EU proposal establishes a tiered mandatory due diligence system involving three steps: gathering information, assessing risk, and mitigating risks to a negligible level. This is linked to a benchmarking system that categorizes countries as low-risk, standard, or high-risk, which determines the level of due diligence obligations for operators.
• The EU's proposed regulation is estimated to save at least 32 million tonnes of CO2 and 71,920 hectares of forest annually.
• The UK Environment Act 2021 provides a framework prohibiting the use of 'forest risk commodities' or derived products in commercial activities unless local laws are complied with. It mandates a due diligence system to identify information, assess risk, and mitigate that risk, though specific commodities and enforcement details are left to secondary regulations.
• The UK's proposed enforcement regime for due diligence may include civil sanctions and criminal offences, with a proposed maximum penalty of GBP 250,000.
• The implementation of mandatory due diligence faces several challenges, including potential conflicts with World Trade Organization (WTO) rules regarding trade discrimination and the risk that compliance burdens are shifted to farmers and smallholders who lack technical capacity.
• Developing countries express concern over 'spillover effects' and the administrative burden created by a 'patchwork' of different national deforestation laws with varying definitions and reporting requirements.

APA

Oeschger, A., & Sarmiento, F. (2022). Due Diligence Requirements to Tackle Deforestation: An overview of the EU and British proposals. International Institute for Sustainable Development. https://www.iisd.org/articles/policy-analysis/deforestation-overview-eu-british-proposals

Chicago

Oeschger, Andreas, and Florencia Sarmiento. Due Diligence Requirements to Tackle Deforestation: An overview of the EU and British proposals. International Institute for Sustainable Development, 2022. https://www.iisd.org/articles/policy-analysis/deforestation-overview-eu-british-proposals.

Wikipedia

{{cite report |last1=Oeschger |first1=Andreas |last2=Sarmiento |first2=Florencia |title=Due Diligence Requirements to Tackle Deforestation: An overview of the EU and British proposals |publisher=International Institute for Sustainable Development |date=7 June 2022 |url=https://www.iisd.org/articles/policy-analysis/deforestation-overview-eu-british-proposals |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{oeschger2022due, author = {Oeschger, Andreas and Sarmiento, Florencia}, title = {{Due Diligence Requirements to Tackle Deforestation: An overview of the EU and British proposals}}, institution = {International Institute for Sustainable Development}, year = {2022}, month = jun, url = {https://www.iisd.org/articles/policy-analysis/deforestation-overview-eu-british-proposals}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }