EU Parliament Rejects EUDR Country Risk Benchmark - What Now?

On July 9th, the EU Parliament formally objected to the EUDR country benchmarking system presented by the EU Commission back in May. The plenary vote resulted in 373 MEPs calling to reject the benchmarking system over concerns about data quality, methodological robustness, legitimacy of the methodology and a lack of transparency regarding the benchmarking criteria. 

This vote was largely symbolic and does not obligate the EU Commission to change its benchmarking system. However, this does increase pressure on the Commission to re-assess its country benchmarking system, and it is expected that they will rush to release an updated version before the regulation goes into effect in December. 

The country risk benchmarking system has a significant impact on due diligence obligations under the law. While all operators placing goods on the EU market for the first time are obligated to map farms and forests associated with their products, collect relevant geolocation data and submit a Due Diligence Statement to customs authorities via the EU TRACES portal, operators sourcing from low-risk countries only need to comply with simplified due diligence obligations - provided there is negligible risk of mixing with goods of unknown origin, or circumvention of the law. Under simplified due diligence obligations, operators are not required to conduct deforestation analysis on polygons from low risk countries, and they do not need to conduct additional due diligence to ensure that their products were made in accordance with national and regional laws in their country of production (otherwise known as legality due diligence). Under the current benchmarking system, 139 countries have been listed as Low risk, 50 as Standard risk and 4 as high risk. Critics have argued that these rankings have little to do with actual deforestation risk, and therefore do not meet the spirit and intent of the law. 

What’s next

While stakeholders await the EU Commission’s response to the July 9th plenary vote, companies should expect the existing country risk benchmark to change before December. All companies that are subject to primary due diligence obligations as operators should continue to map their farms and forest and conduct deforestation for all associated plots of land regardless of their original standing on the country risk benchmark to ensure they are prepared for any likely changes. 

To learn more about how Sourcemap can help companies comply with the EU Deforestation Regulation, reach out to our team of experts.