What Is EUDR? The EU Deforestation Regulation Explained

Understanding How the Regulation Works

In our previous article, Why is Everyone Talking About EUDR, we explored why organizations around the world are suddenly receiving new questions from customers, suppliers, and business partners about the products they buy, manufacture, and sell. Those questions all point to the same place: the European Union Deforestation Regulation (EUDR).

Key Takeaways

• EUDR stands for the EU Deforestation Regulation, formally Regulation (EU) 2023/1115. It was adopted to reduce the European Union’s contribution to global deforestation and forest degradation.
• Rather than banning products outright, EUDR works through due diligence requirements. Covered products must be deforestation-free, produced in line with the laws of the country of production, and supported by a documented due diligence process.
• The Regulation applies to seven commodities: cattle, cocoa, coffee, oil palm, rubber, soy, and wood, along with many derived products such as furniture, paper, printed materials, and rubber goods.
• Responsibilities are shared across the system. The European Parliament and Council adopted the Regulation, the European Commission publishes guidance, Competent Authorities enforce it, and Operators and Traders carry the compliance obligations.
• Organizations with obligations submit a due diligence statement through the EU Information System before covered products enter, move within, or leave the EU market.
• At its heart, EUDR is about information moving through the supply chain, including geolocation, species, and country of production. The products themselves often have not changed. The information expected to travel with them has.

From Questions to Understanding

The next logical question is simple:

What exactly is EUDR?

This article explains how the Regulation works. Future articles will explore how to determine whether it applies to your organization and what compliance looks like in practice.

Most discussions of EUDR begin by explaining individual requirements. Before exploring those requirements, however, it helps to step back and understand how the Regulation is organized and how the different participants work together. Understanding the system first makes the individual requirements much easier to understand.

EUDR Is Designed to Do

Before discussing compliance, it helps to understand what EUDR was designed to accomplish.

The European Union Deforestation Regulation (EUDR), formally known as Regulation (EU) 2023/1115, was adopted to reduce the European Union’s contribution to global deforestation and forest degradation associated with the production and trade of certain commodities and derived products.

Although EUDR is often described as a sustainability regulation, it achieves its objectives by establishing due diligence requirements for certain commodities and products associated with the European Union market.

The Regulation establishes due diligence requirements for specified commodities and products that are placed on the EU market, made available on the EU market, or exported from the EU. Its objective is to help ensure that covered products are deforestation-free, have been produced in accordance with the relevant legislation of the country of production, and are supported by an appropriate due diligence process.

Which Commodities and Products Does EUDR Cover?

The Regulation identifies seven commodities within its scope:

• Cattle
• Cocoa
• Coffee
• Oil Palm
• Rubber
• Soy
• Wood

It also applies to many products derived from those commodities, including a wide range of wood products, furniture, paper, printed materials, rubber products, and other items identified in Annex I of the Regulation.

At first glance, that may sound straightforward. In practice, however, organizations quickly discover that understanding the Regulation involves much more than determining whether a particular product appears on a list. It also requires understanding who has responsibilities under the Regulation, how those responsibilities differ, and how information supports the due diligence process.

That’s the legal framework. Understanding how that framework operates in practice is what makes the rest of the Regulation easier to understand.

How Is EUDR Organized?

One of the easiest ways to understand the Regulation is to look at who is responsible for the different parts of the system.

The European Parliament and the Council of the European Union adopted Regulation (EU) 2023/1115.

The European Commission supports implementation by publishing guidance documents, Frequently Asked Questions (FAQs), benchmarking information, and educational resources intended to promote consistent application throughout the European Union.

Each EU Member State designates one or more Competent Authorities responsible for enforcing the Regulation within its jurisdiction. These authorities conduct inspections, investigate potential non-compliance, and apply enforcement measures established under the Regulation.

Organizations participating in supply chains also have defined responsibilities. Depending on the circumstances, they may act as Operators or Traders, each with different obligations established by the Regulation.

Organizations with due diligence obligations submit a due diligence statement through the EU Information Systemdeclaring that they have exercised due diligence in accordance with the Regulation before covered products are placed on, made available on, or exported from the EU market. Later articles in this series will explore what that statement contains, how it is prepared, and how it supports compliance.

At this stage, the important point is simply that not every organization has the same responsibilities. Understanding those different roles provides the foundation for understanding how the Regulation works in practice.

Figure 1. Simplified overview of the EUDR regulatory framework.

How Does EUDR Work?

Once the different participants are understood, the overall structure of the Regulation becomes much easier to follow.

One helpful way to understand the Regulation is to think about how information supports decisions throughout a supply chain.

Products move through forests, farms, manufacturers, distributors, importers, retailers, and ultimately to customers. Along the way, organizations make decisions about sourcing, purchasing, manufacturing, importing, exporting, and selling.

The Regulation requires certain organizations to gather and evaluate information before covered products are placed on, made available on, or exported from the European Union market. That information supports the due diligence process and provides the basis for the due diligence statement submitted through the EU Information System.

Depending on the commodity, product, and an organization’s role within the supply chain, that information may include details such as species, country of production, geolocation information, quantities, suppliers, customers, and documentation supporting the due diligence process.

One helpful way to think about the Regulation is that while products move through supply chains, information is gathered, evaluated, retained, and communicated to support due diligence at different stages. Some information originates at the forest or farm. Other information is generated, verified, or retained by manufacturers, traders, importers, exporters, or other participants as products move through the supply chain.

This perspective also explains why organizations outside the European Union are increasingly receiving requests for information from customers they may have worked with for years.

The products themselves often have not changed. The information expected to accompany them has.

Why Information Matters

Let’s return to the questions that opened our first article.

“Can you provide the GPS coordinates for the forest where this wood was harvested?”

“We’ll need the geolocation polygon for the production plot.”

“Can you send us your EUDR Reference Number?”

Individually, these requests may seem unrelated.

Viewed through the framework of the Regulation, however, they become much easier to understand.

Each request represents information needed somewhere within the due diligence process. Whether an organization has direct obligations under the Regulation or is supporting customers that do, that information helps organizations evaluate products, demonstrate compliance with applicable requirements, and support informed due diligence decisions throughout the supply chain.

Understanding that broader purpose transforms what can initially seem like administrative paperwork into information that supports informed due diligence decisions throughout the supply chain.

How EUDR Implementation Is Evolving

Although Regulation (EU) 2023/1115 provides the legal foundation for EUDR, implementation continues to evolve. The European Commission continues to publish guidance documents, FAQs, benchmarking decisions, and other implementation resources to support consistent application throughout the European Union. In addition, implementation timelines have been revised through subsequent legislative actions.

For organizations preparing for EUDR, the Regulation remains the legally binding foundation. However, understanding current implementation expectations also requires following the latest official guidance published by the European Commission.

Throughout this series, we distinguish between:

• Requirements established by the Regulation;
• Official guidance published by the European Commission; and
• Practical implementation considerations based on experience supporting organizations preparing for EUDR.

Understanding the difference between those sources helps organizations make better-informed decisions as implementation continues to mature.

How Does EUDR Apply to My Business?

One of the first questions organizations ask after learning about EUDR is:

“Does this Regulation apply to my business?”

The answer depends on several factors, including the commodities and products involved, an organization’s role within the supply chain, and how products enter, move within, or leave the European Union market.

In the next article, we’ll explore how organizations can begin answering that question and identify the first steps in determining whether the Regulation applies to their operations.

Official EUDR Resources

Because implementation continues to evolve, organizations should always consult the most current official publications when making compliance decisions.

Recommended resources include:

• Regulation (EU) 2023/1115 (EUR-Lex). Official legal text.
• Consolidated Regulation. Current consolidated version incorporating amendments.
• European Commission: EU Deforestation Regulation. Central implementation portal.
• Frequently Asked Questions (FAQs). Official implementation clarifications.
• Guidance Documents. European Commission guidance supporting implementation.
• Information System. Guidance, training, and user resources.
• Supply Chain Resources and Infographics. Visual explanations of key EUDR concepts.

LEARN MORE

For the official European Commission overview of the EU Deforestation Regulation, including guidance documents, implementation resources, and supply chain infographics, visit: EU Regulation on Deforestation-free Products.

About the Cherrywood Partners EUDR Educational Series

There is no shortage of information about EUDR. The challenge is not finding it. The challenge is making sense of it. This educational series is designed to build understanding one topic at a time. Each article focuses on a single practical question, drawing on the Regulation itself, official European Commission guidance, and hands-on implementation experience. Throughout the series, we distinguish between legal requirements, official guidance, and practical implementation considerations, so readers can understand not only what the Regulation requires, but what it means in practice.

Our goal is not to add to the volume of EUDR information already available. It is to build a resource that organizations can return to whenever the next question arises.

Contact: andrew@cherrywood.partners

This is Article 2 in the Cherrywood Partners EUDR Educational Series.