EU Should Make Deforestation Rules More Flexible to Comply With WTO, Brief Says

The EU's Deforestation Regulation (EUDR), which could take effect for some companies Dec. 30, may violate World Trade Organization rules and should be modified to ensure it's compliant, according to a new policy brief released by the European Center for International Political Economy (ECIPE).

The EUDR, which could be postponed by one year if approved by the European Parliament and member states (see 2410040022), is designed to address concerns that deforestation increases greenhouse gas emissions and fuels climate change. It requires European importers of beef, cocoa, coffee, palm oil, rubber, soy, wood and their derivative products to prove their goods did not come from forest areas converted after the end of 2020. Non-EU countries, however, have argued that the EUDR interferes with local affairs.

“Goods produced in areas that have been converted after this date may not access the EU single market,” the brief says. “This imposes a challenge for many developing tropical countries that for historical reasons might have not concluded their processes of land occupation.”

The author argues that the EU could strengthen the regulation’s WTO compatibility by making it “more flexible and reflective of local realities.” For example, an initiative in Brazil has been “highly successful” in limiting the amount of soy linked to deforestation, but it would fail to be EUDR-compliant because it would not meet the regulation's call for “full traceability of each soybean from each plot of land until the final product is put in the market.”

If the EU acknowledged different conditions in non-EU countries and became accepting of alternative approaches, "it is plausible to suggest that the EUDR could be deemed as non-discriminatory and calibrated towards its objectives," the brief says.

The 17-page document, which ECIPE released last month, was written by trade economist Bruno Capuzzi, policy leader fellow at the European University Institute’s Florence School of Transnational Governance.