On October 21 the Commission retracted its initial postponement plans for the EUDR and announced that due diligence obligations under the EUDR will begin to apply to medium-sized and large enterprises as early as December 30 2025, as planned.
The latest proposal includes a range of 'targeted measures' aimed at simplifying requirements, most notably for small and micro enterprises who will have an additional 12 months to comply with the regulation. While these targeted adjustments could affect compliance strategies, the main timeline for implementation of the EUDR remains unchanged for most businesses.
EUDR – a brief reminder
The EUDR prohibits placing on the EU market certain products containing or made with "relevant commodities" that are associated with deforestation and forest degradation. These commodities are cattle, cocoa, coffee, oil palm, rubber, soya and wood including any "derived products". Before they can supply and sell these products on the EU market or export them from the EU, businesses will be required to perform due diligence on the origins of in-scope products and verify that they are deforestation-free. The EUDR provides for the classifying of countries as low, standard or high risk in terms of deforestation, and this risk rating determines the level of due diligence required. However, it is important to note that due diligence obligations apply to products produced in all countries. Even those countries designated as low risk have some due diligence obligations, albeit reduced ones.
Key measures introduced by the Proposal
As mentioned above, the new proposal does not delay the overall implementation of the EUDR and instead introduces more targeted extensions for micro and small operators allowing for compliance by 30 December 2026 (instead of June 2026).
For all other businesses the EUDR will enter into force on 30 December 2025 as planned.
The proposal introduces a number of important changes mainly reducing obligations for:
- Downstream operators and traders that commercialise the relevant EUDR products once they have been placed on the EU market, for example, retailers or large EU manufacturing companies. The upstream operator will continue to exercise due diligence.
- Micro and small primary operators from low-risk countries worldwide who sell their goods directly on the European market. These cover close to 100% of farmers and foresters in the EU.
Other key changes include:
New Definitions
The EUDR now formally creates a subcategory for 'Micro and Small Primary Operators' with simplified compliance obligations. This new category covers natural persons, micro and small undertakings established in low-risk countries that produce and place their own products on the market. 'Downstream Operators' have also been defined as entities placing products on the market that are made using relevant products that are already covered by a due diligence statement or simplified declaration upstream.
Simplified Due Diligence
- Micro and small primary operators can submit a one-time simplified declaration in the EUDR IT system which includes the replacement of the geolocation data with the postal address of all plots where the relevant product has been produced.
- Downstream operators and traders will no longer need to submit a separate Due Diligence Statement (DDS). Instead, one DDS at the time the product is placed on the EU market will cover the entire supply chain. Non-SME downstream operators and traders will still be required to register in the IT system and pass on their DDS identifiers to maintain traceability, but they will not be required to submit new statements for each transaction.
Clarified Roles
A number of roles within the supply chain have been clarified:
- Operators – Entities placing the relevant products on the market. Notably does not include downstream operators.
- Traders – Entities other than operators or downstream operators.
- Commercial Activity – Includes processing, distribution or internal use by not only operators and traders but also downstream operators.
- Authorised representatives – Entities mandated to act on behalf of operators within the EU.
Transitional period for companies to strengthen the EUDR IT system
The Commission is also proposingtransitional periods to guarantee a smooth transition and to strengthen its IT system for compliance. While the date remains 30 December 2025 for large and medium sized companies, they will benefit from a grace period of six months for checks and enforcement to ensure a gradual phase-in of the rules.
The Commission is working to stabilize the EUDR IT system which has faced challenges due to high data volumes. While these challenges were cited as the reason for the initial delay of the EUDR for a further year, the Commission has now said that the new entry into application dates combined with the simplification of obligations for certain supply chain actors aims to ensure that the IT system can sustain the level of expected loads.
Timeline and next steps
The Commission's proposal must now be examined by the European Parliament and the Council of the EU. With the EUDR's commencement date looming, the Commission is likely to request the fast-track legislative procedure (as it did last year).
What should businesses do now?
The most important take away is that if your company does not qualify as a micro or small primary operator then based on this proposal, due diligence obligations will begin on 30 December 2025 with the enforcement grace period ending 30 June 2026.
While the grace period may delay enforcement action, businesses should use this time wisely to ensure they are ready to meet the full requirements of the EUDR. This includes assessing their own role along with a mapping of the entire supply chain to identify relevant actors. Preparation should also include an evaluation of internal IT systems which will be required to integrate with the EU's digital reporting system. Internal systems should include robust data collection and product traceability along the supply chain.
Downstream actors (retailers, manufacturers) might see reduced compliance burden under the new proposal, but they should not assume full de-risking and continue to stay abreast of the legislative process and plan with a degree of flexibility concerning their compliance system.
Legislative Uncertainty
While the Commission has called for a quick adoption of the proposal by the end of 2025, the legislative process remains subject to change and uncertainty which may introduce further revisions or delays.
In this respect, businesses should monitor developments closely and prepare for the currently confirmed application of the EUDR to place themselves in the best possible position to ensure smooth compliance, as final guidance and technical details may only emerge after adoption.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
