EUDR for dummies: Your guide to navigating the EU Deforestation Regulation

What is the EU Deforestation Regulation, and why does it matter?

The EU Deforestation Regulation (EUDR) is the European Union’s latest legislative effort to tackle global deforestation. In simple terms, it aims to ensure that products sold or consumed in the EU market or even exported from the EU do not contribute to global deforestation or forest degradation. Companies will need to demonstrate that their products are deforestation-free, and not linked to forest degradation, nor illegal harvesting and trade.

The regulation focuses on several high-risk commodities—soy, palm oil, coffee, cocoa, cattle, timber, and rubber—that have historically been linked to forest loss.

However, EUDR is more than an environmental policy. It’s part of the EU’s broader ambition to drive sustainable business practices, promote biodiversity, and reduce the EU’s carbon footprint. For companies operating in or trading with the EU, EUDR signals a shift: sustainability due diligence is no longer optional.

Who is affected? Key industries and businesses impacted by EUDR

EUDR applies to any business placing relevant products or derived goods on the EU market or exporting them from the EU. This includes manufacturers, traders, and distributors across a wide range of industries.

The sectors most affected include:

• Food and beverage (e.g., companies sourcing soy, coffee, cocoa, or palm oil).
• Retail and consumer goods (e.g., products containing wood, rubber, or leather).
• Textiles and fashion (e.g., leather supply chains).
• Construction and furniture (e.g., timber products).

If your supply chain touches any of these commodities, you will likely need to comply with EUDR requirements—even if your operations are outside of the EU.

Businesses of all sizes are within scope, but larger companies face stricter due diligence and reporting expectations. Small and medium-sized enterprises (SMEs) may have simplified requirements, but will still need to take action.

Why should companies care? The risks and opportunities of EUDR compliance

The risks of non-compliance:

• Regulatory penalties: Non-compliance could lead to fines, product seizures, or exclusion from the EU market.
• Supply chain disruption: Businesses without visibility into their upstream sourcing may face delays or reputational damage.
• Loss of customer trust: Consumers and corporate partners increasingly expect products to be deforestation-free.

The opportunities:

• Stronger supply chain resilience: EUDR encourages better supply chain mapping and risk management.
• Enhanced brand value: Businesses that demonstrate responsible sourcing can improve customer loyalty and appeal to sustainability-conscious investors.
• Alignment with broader ESG goals: EUDR compliance complements climate action, biodiversity strategies, and future-proofed business models.

For companies committed to long-term resilience, EUDR is not just a regulatory burden—it’s a chance to lead on sustainable sourcing and future-proofing their business.

EUDR in 2025: Important changes to the legislation

Since its original adoption, the EU Deforestation Regulation has been subject to key updates that affect both timelines and implementation requirements for businesses. Staying up to date on these changes is critical for companies aiming to meet compliance deadlines and avoid disruption.

EUDR postponed: new application dates announced

On 3 December 2024, the European Parliament and European Commission voted to postpone the application of the EUDR by 12 months, following an agreement reached during Trilogue negotiations. The amending regulation (EU 2024/3234) was officially published on 19 December 2024, giving companies more time to prepare.

The key updated deadlines are as follows:

• For most operators and traders, the compliance deadline is now 30 December 2025.
• For micro and small enterprises established before 31 December 2020, the deadline has been extended to 30 June 2026, with one exception. Micro and small enterprises established before 31 December 2020 generally have until 30 June 2026 to comply with the regulation. However, if these small/micro enterprises sell products produced by larger companies, they must comply with the earlier deadline of 30 December 2024 — the same as larger enterprises.
• Wood products covered by the EU Timber Regulation (EUTR) must still comply with EUDR requirements by 30 December 2025.

This extension provides a valuable window for companies to enhance supply chain due diligence and implement traceability systems—but it also emphasizes the need to act now to avoid a last-minute rush.

When will the country benchmarks be available?

The EUDR introduces a country benchmarking system, which will classify countries into low, standard, or high-risk categories based on deforestation risk. These benchmarks will influence the level of scrutiny companies must apply to products sourced from each region.

The first official country benchmarking list is expected to be published by 30 June 2025, providing businesses with clearer guidance on risk-based due diligence requirements.

The transition from the EU Timber Regulation (EUTR)

The EUTR was formally repealed on 30 December 2025, aligning with the new EUDR application date for timber products. However, transitional rules will apply:

• The EUTR will continue to govern timber harvested before 29 June 2023, as long as it is placed on the market between 30 December 2025 and 30 December 2028.
• After this period, all timber and wood products will be fully subject to EUDR requirements.

Businesses in the timber and forestry sectors should take note of this phased transition and begin aligning their compliance strategies accordingly.

How to prepare for EUDR compliance

EUDR requires companies to conduct due diligence on their supply chains and ensure that their goods do not result from recent (post 31 December 2020) deforestation, forest degradation or breaches of local environmental and social laws. Here’s how businesses can start preparing:

1. Map your supply chain

Identify the origin of your products and the commodities they contain. This means tracing products down to the plot of land where raw materials were produced, especially for high-risk goods.

2. Implement traceability systems

Collect geolocation data and supply chain documentation to demonstrate compliance. Consider adopting digital tools to automate data collection and streamline traceability.

3. Conduct deforestation risk assessments

Evaluate sourcing regions for deforestation risk. Regions with high forest loss will require more rigorous checks, including evidence from suppliers that their operations are deforestation-free.

4. Engage with suppliers

Work with suppliers to ensure they meet EUDR criteria. Training, contractual clauses, and sustainability audits may be necessary to bring partners in line with the regulation.

5. Prepare for reporting and record-keeping

Companies must submit a due diligence statement before placing products on the EU market, confirming that no deforestation or forest degradation has occurred. Records must be kept for at least five years and made available to authorities upon request.

How EUDR supports a broader biodiversity and financial strategy

EUDR is part of a growing global emphasis on protecting ecosystems and biodiversity. By aligning EUDR compliance with your wider sustainability efforts, your business can unlock both environmental and financial benefits.

For example:

• Protecting biodiversity reduces operational risks linked to disrupted supply chains and volatile commodity prices.
• Stronger ESG performance can improve access to financing, as lenders and investors increasingly factor biodiversity into risk assessments.
• Integrating EUDR into your corporate biodiversity strategy enhances alignment with frameworks like the EU Taxonomy and emerging biodiversity standards.

Ultimately, EUDR compliance can be a stepping stone toward a more resilient, sustainable business model that meets stakeholder and market expectations.

Conclusion: Don’t wait to act on EUDR

The EUDR introduces new complexity, but also new opportunities for businesses. Early preparation is key. Companies that invest in supply chain traceability and engage proactively with suppliers will be better positioned to meet regulatory deadlines and demonstrate leadership in sustainability.

Delaying compliance efforts increases the risk of supply chain disruption, regulatory fines, and reputational harm. But by starting now, organizations can turn compliance into a competitive advantage.

All the more, the foundational aspects of compliance, such as auditing supply chains, conducting a DMA, or collecting your data are precursors for sustainable impact. Whether it’s deforestation regulation or ESRS due diligence, we provide you the insights you need to make informed decisions about your compliance goals and to help you lay the pathway to long-term sustainable business value.

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