EUDR Country-Risk Benchmarking: What Is It, and Why It Matters

A critical part of the EU Deforestation Regulation is the concept of country-level risk. Operators placing EUDR-relevant commodities and derived products on the EU market for the first time are not only responsible for submitting due diligence statements corresponding to those goods, but they are also responsible for ensuring that the commodities they place on the market are harvested legally in their countries of production. The level of EUDR risk assigned to the country of production impacts the level of due diligence operators must complete in order to ensure that their goods have been harvested legally. The EU Commission published a list of countries with risk levels assigned as low, standard or high, and despite initial pushback from Parliament, has not made any moves to amend the list in the lead up to the December 30th enforcement deadline.

The following are some clarifications about how country-risk benchmarking does and does not impact EUDR obligations.

If EUDR-relevant goods are sourced entirely from low-risk countries, is it still necessary to submit a DDS with geolocation data to EU TRACES?

Yes! There is no exception for the traceability requirement via geolocation (or, in the case of a micro or small primary operator, the postal address). The primary operator placing an EUDR-relevant commodity or derived product on the EU market for the first time - or exporting an EUDR-relevant product from the EU for the first time that has not previously been placed on the EU market - must submit a DDS to TRACES regardless of whether the country of origin is low, standard or high risk. The operators also have to assess the complexity of the relevant supply chain, the risk of circumvention of the Regulation and the risk of mixing with products of unknown origin or origin in high-risk or standard-risk countries or parts thereof, per Article 13 of the Regulation.

Do full legality due diligence obligations apply to operators sourcing entirely from low-risk countries?

No. Operators sourcing commodities entirely from areas classified as low risk will be subject to simplified due diligence obligations. According to Art. 13 of the adopted text, they will still need to assess the complexity of the supply chain and the risk of circumvention and the risk of mixing the product with products of unknown origin or origin of standard or high risk countries, but they will not be required to assess and mitigate risks (Art. 10 and 11 EUDR) unless the operator obtains or is made aware of any relevant information, including substantiated concerns submitted under Art. 31 , that would point to a risk that the relevant products do not comply with this Regulation (Art. 13(2) EUDR).

What happens if the Commission updates its Country Risk Benchmarking? Will previously submitted due diligence statements be re-classified?

If the Commission were to update its country risk benchmarking and re-classify as country to a higher risk level, the updates would apply to any due diligence statements and their associated products moving forward, not retroactively to due diligence statements already submitted to the TRACES system.

For more information about the EU Deforestation Regulation, or to speak with a team of Sourcemap's in-house policy experts, reach out to our team today.