European Forest and Timber Trade Regulations – Recent Developments

16th May 2023

Following the announcement of the European Green Deal (EUGD) in December 2019, the European Commission (EC), the European Parliament (EP) and the Council of the European Union (CEU) started work on new implementation guidelines and regulations to tackle EU-driven deforestation and improve the share of renewable energy sources in its energy grid.

The current EU Timber Regulation (EUTR), which is part of the Forest Law Enforcement, Governance and Trade (FLEGT) Action Plan, was not fully addressing concerns regarding sourcing of wood products from outside the European Union. In January 2020, the EP requested the creation of a new timber trade framework, which was named the European Union Deforestation Regulation (EUDR). The EUDR aims to tighten restrictions around origin of wood and provide guidelines on monitoring and addressing risks around deforestation and forest degradation. The EUDR was adopted by Parliament on 19 April 2023, and now needs to be endorsed by the EU Council before it comes into effect. Once in effect, it is expected to fully replace the EUTR.

As part of the Fit-for-55 package of the EUGD, the revision of the EU Renewable Energy Directive, commonly called RED III, reached its final trialogue on 30 March 2023. Along with increasing the use of renewable energy sources to 42.5% by 2030, EU legislators also included changes to the use of biomass. The new regulation continues to recognise the importance of sustainable biomass, rejects potential caps to the use of in-forest wood biomass and still classifies wood pellets as renewable energy. The new regulation does however prohibit the use of some sources of biomass, such as biomass from areas rich in biodiversity or from primary forests. It also removes subsidies for roundwood that could be used for other high-value products.

Not everyone welcomed this decision as only a few months ago the EP was expecting to remove biomass (and wood pellets) from being carbon neutral. While most forest advocates agree that RED III shows positive steps towards protection of the environment, many are still concerned that the new biomass policy will further damage forests and exacerbate climate change. One of the main arguments is that research[1] shows that biomass burning power plants emit 150% the CO2 of coal, and 300–400% the CO2 of natural gas, per unit energy produced.

Another piece of legislation that will impact forestry trade is the revision of the Registration, Evaluation, Authorisation and Restriction of Chemicals (REACH) regulation. REACH does not allow the use of certain preservatives and chemicals to prevent rot and improve the durability of timber. REACH also applies to imported treated timber.

Other legislation in progress such as the revision of the Construction Products Regulation (REFIT), will include new environmental, functional and safety product requirements that will impact both domestic and imported construction products.

More information on the EUGD and the progress of various pieces of legislation can be found on the EP’s Legislative Train Schedule website.

[1] Partnership for Policy Integrity (PFPI). Carbon emissions from burning biomass for energy.