The EUDR framework: scope, definitions, and obligations
It is against the backdrop complex multi-jurisdictionally fragmented global supply chain that I talked about in my last post 1 and post 2 that the EUDR must be understood.
Across all commodities, the pattern is consistent: forests are cleared not for local consumption, but to supply global markets.
This is borne out by research as well, as the study from Pendrill et. al. states “for many developed countries, deforestation emissions embodied in imports rival or exceed emissions from domestic agriculture. Depending on the trade model used, 29–39% of deforestation-related emissions were driven by international trade.“
The EUDR establishes a market-access condition: only deforestation-free commodities and products may be placed on, made available on, or exported from the EU market, and only where they are accompanied by a valid due diligence statement and produced in accordance with the relevant laws of the country of production.
Core conditions under the EUDR
The Regulation applies to seven agricultural commodities, along with their derivatives. For these products to lawfully enter or circulate within the EU market, all three conditions must be met:
- Deforestation-free status
The products must not have caused or contributed to deforestation or forest degradation. - Legal compliance in the country of origin
Production must comply with all applicable laws of the country of production. - Due diligence statement
Operators must submit a due diligence statement confirming that the product’s origin has been assessed and that EUDR requirements are satisfied.
Enforcement and penalties
The EUDR is backed by a robust enforcement regime. Non-compliance can trigger significant penalties, including:
- Fines of up to 4% of a company’s annual EU turnover
- Confiscation of the non-compliant products
- Temporary exclusion from public procurement procedures and access to public funding
- Temporary market exclusion, being prohibition from placing or making available on the market or exporting relevant commodities and relevant products, in the event of a serious infringement or of repeated infringements.
These measures underscore that the EUDR is not a disclosure exercise, but a market-access regulation with real economic consequences.
In addition to formal sanctions, non-compliance carries a significant risk of reputational damage and loss of consumer trust.
Key definitions under the EUDR
Understanding the EUDR hinges on a small number of carefully defined terms, many of which align with FAO standards.
Forest
Land spanning more than 0.5 hectares with trees higher than 5 metres and a canopy cover of more than 10%, or trees able to reach these thresholds in situ. Land predominantly under agricultural or urban use is excluded.
This definition is aligned with the FAO.
Deforestation
The conversion of forest to other land use, including conversion to plantations, regardless of whether the conversion is human-induced.
Also FAO-aligned.
Forest degradation
Changes within a forest that negatively affect its species composition, structure, or function, reducing its capacity to supply products, support biodiversity, or deliver ecosystem services.
While the FAO does not formally define forest degradation, this concept is closely aligned with FAO approaches.
Deforestation-free
A commodity or product that has neither caused nor contributed to deforestation or forest degradation. The EUDR introduces a strict cut-off date of 31 December 2020: products must not originate from land that was subject to deforestation after that date.
The 2025 amendment: shifting complexity rather than simplifying compliance
Following the simplification process initiated with the Omnibus, the 2025 amendment to the EUDR was presented as a necessary recalibration aimed at reducing administrative burden, particularly for smaller operators. It also delayed the application of the Regulation by one year, until 30 December 2026 for large and medium operators, and 30 June 2027 for micro and small operators, and narrowed the scope of certain obligations.
Some of these changes respond to legitimate concerns. The compliance demands of the EUDR are substantial, data-intensive, and costly, especially in supply chains dominated by smallholders and fragmented production structures. A phased implementation and differentiated obligations were always part of the regulatory logic.
Under the revised framework, only operators that first place relevant commodities or products on the EU market are required to submit due diligence statements (DDS).
The proposed amendments also redraw the Regulation’s material scope. Printed products—such as books and other publications—would fall outside the EUDR, reducing the breadth of regulated goods. This carve-out may ease compliance for parts of the publishing sector, but it sits alongside the continued inclusion of other paper-based products derived from forest-risk commodities, raising questions about the coherence of the overall framework.
Micro and small primary operators simplification
Micro and small primary operators are required to submit a one-time simplified declaration. The Regulation allows this declaration to be updated in the event of a major change, but the extent to which such updates are mandatory remains unclear.
This simplified declaration may contain either geolocation data or the postal address of all plots of land on which the relevant commodities were produced. The EU’s IT system would assign a declaration identifier to such declarations, which identifier would need to be passed downstream.
Downstream operators and traders, i.e. those who subsequently sell, process, or distribute products, are now no longer required to submit their own DDS. However, they remain required to possess certain information (a large number of them in reality) to be able to make the products available on the EU market. Furthermore, downstream operators remain subject to checks and non-compliance may entail corrective actions and penalties.
The European Commission is required to carry out a simplification review by 30 April 2026, to evaluate the administrative burden and impact, particularly for micro and small operators.
How to comply with the EUDR?
A superficial reading of the EUDR suggests that compliance should be straightforward – costly, but conceptually simple.
- Due Diligence Mechanism: Eligible businesses need to establish and maintain a due diligence system to provide evidence that their products can fulfill the criteria of the EU.
- Traceability: Companies must collect geolocation data for every point in the supply chain.
- Risk Assessment and Mitigation: If a product is deemed to be at risk of deforestation, businesses are required to take action to mitigate this risk, which can be done by by finding alternative suppliers or improving transparency in their supply chains.
However, closer scrutiny reveals that the seemingly straightforward requirement to comply with all applicable laws is potentially one of the most legally complex elements of the EUDR.
Any lawyer experienced in commercial contracting knows that an unqualified obligation to “comply with all applicable laws” is rarely accepted without limitation. In practice, such clauses are routinely narrowed through jurisdictional limits, temporal qualifiers, knowledge or reasonable-efforts standards, and cure periods for minor or technical breaches.
The EUDR, however, imposes precisely such an unqualified obligation—without the possibility of negotiated carve-outs.
India is not an outlier in this respect, but it provides a useful illustration. I studied law in India. When it comes to the legal framework, you can have a near endless number of laws, some of them conflicting, from the central government, the state government, very specific local land laws, laws relating to a certain group of people who are living in very small pockets of India, land use laws, environment, conservation, forest usage rights, human rights, rights of indigenous people, pollution, among others. In many of these places, laws are likely to be fragmented, contained in several pieces of legislations, and sometimes can even conflict. And do not expect that these laws will all be neatly filed and available in a digital archive. Hunting down a copy of the legislation was often a multi-week effort.
So how will a company ensure this requirement is fulfilled? One option will be to conduct expensive comprehensive annual audits each year.
In jurisdictions where the number of smallholders runs into the millions, it is legitimate to ask whether even extensive, well-resourced audits can ever be sufficiently comprehensive to satisfy an absolute legal-compliance standard.
In trying to do good, will EUDR make life more difficult for small shareholders and create a bias in favor of the larger players?
Conclusion: a regulation whose ambition may outpace its operational design
The EUDR reflects a clear and commendable policy objective: leveraging market access to curb global deforestation. Its ambition, enforcement architecture, and alignment with international definitions signal that the EU is serious about addressing forest-risk commodities.
At the same time, the EUDR raises difficult questions about whether its most stringent requirements—particularly the obligation to ensure compliance with all applicable laws in the country of production—have been fully stress-tested against the realities of complex, fragmented, and often under-documented legal systems. The 2025 amendments mitigate certain procedural burdens, but they also redistribute compliance risk in ways that may not meaningfully reduce legal exposure for many operators.
The risk, therefore, is not that the EUDR lacks ambition, but that its design assumes a level of legal clarity, traceability, and verifiability that does not consistently exist across global supply chains. Whether forthcoming guidance, enforcement practice, and the promised simplification review can bridge this gap remains to be seen. What is clear already is that compliance under the EUDR will require not only technical systems and data, but difficult judgments about legal risk in jurisdictions where certainty is often elusive.
Stay informed,
Samarpita
All opinions are personal
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