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This comes despite comments just a week ago that it would push ahead as planned with the implementation of the EUDR at the end of this year.
The Commission said in a statement that, since all the implementation tools are technically ready, the extra 12 months will serve as a phasing-in period to ensure all stakeholders will be ready for effective implementation.
The Commission also published additional guidance documents, updated FAQs, and an international cooperation framework to support global stakeholders, member states and third countries in their preparations for the implementation.
“The Commission recognizes that three months ahead of the intended implementation date, several global partners have repeatedly expressed concerns about their state of preparedness, most recently during the United Nations General Assembly week in New York,” it said in the statement. “Moreover, the state of preparations amongst stakeholders in Europe is also uneven. While many expect to be ready in time, thanks to intensive preparations, others have expressed concerns.”
The guidance documents cover details on the functionalities of the Information System, updates on penalties, clarifications on critical definitions such as ‘forest degradation’, ‘operator’ in the scope of the law, and ‘placing on the market’, as well as further guidance on traceability obligations.
Most countries ranked as ‘low risk’: The Commission has also clarified the principles it will apply to the EUDR benchmarking and highlighted that, following the methodology applied, a large majority of countries worldwide will be classified as ‘low risk’. This means that, in many cases, operators will have to draft a simplified due diligence instead of a full due diligence. “The Commission is intensifying dialogues with most concerned countries, which will feed into the speedy finalization of the country benchmarking system through a proposed Implementing Act by 30 June 2025,” it said.
Finally, the Commission said that the Information System for the diligence statements will be ready to accept registrations in November and will be fully operational in December.
P&P industry celebrates: The pulp and paper industry, as well as the printing segment, welcomed the EU’s decision to propose a delay in the implementation of the EUDR.
“Intergraf welcomes the one-year delay in the implementation of the EUDR. The release of the guidance and updated FAQs is also welcome, as it will help us prepare the sector for the new rules,” Intergraf secretary general Beatrice Klose told Fastmarkets. She added: “We will continue supporting the printing industry in its compliance efforts. In Europe, the EUDR will impact more than 100,000 printing companies, with 90% employing fewer than 20 people.”
The Confederation of European Paper Industries (Cepi) said the delay would allow for a better implementation of the regulation and stronger impact on deforestation. “The EUDR is too important not to get it right,” Cepi director general Jori Ringman said in a statement. “We certainly do not ignore the environmental crisis and the climate emergency, which the EUDR is designed to help solve. Nor is our industry a source of deforestation. From a business angle, deforestation is major reputational risk which for any industry; our industry also depends on healthy forests for our own future.”
“The postponement, although still pending approval by the European Parliament and the Council, could allow companies to prepare in a more controlled way,” Fastmarkets RISI director, Europe packaging and graphic paper Alejandro Mata told Fastmarkets. “This will reduce the risks of a more significant negative impact on the short-term economic growth of the region.”
Decision to send positive signal to producers: The Commission’s decision to propose a delay will also be seen as a blessing by producing countries, which have been concerned about the impact of the regulation on trade with the EU.
On Tuesday, the EUDR was among the most discussed topics by government officials and industry representatives gathered in São Paulo, Brazil for the 56th International Pulp and Paper Congress and Exhibition. “There is a very intense debate happening in Europe… It may be humanly impossible for European authorities to apply all these rules within the deadlines they are setting,” José Carlos da Fonseca Júnior, ambassador, director of International Relations at industry association Ibá and executive president of the Brazilian Paper Packaging Association (Empapel) told Fastmarkets at the event.
According to Fonseca, Brazilian pulp-producing companies have been moving quickly to meet all the requirements imposed by the EUDR, but some technical aspects of the new regulation still raise doubts and concerns among business leaders.
One of them relates to how the sector should prove the traceability of pulp, which continues to cause uncertainty in the local market. Another challenge is related to the European authorities’ demands for sensitive data from Brazilian companies and how regulators should protect this information.
Last week, a number of industry organizations affected by the regulation, including paper and board producer associations, had urged the EU to delay the EUDR’s entry into force and to provide all the necessary compliance tools with sufficient time to prepare adequately.