Jade Saunders
Associate Fellow, Energy, Environment and Resources
Children sitting on logs on the outskirts of Yangon May 4, 2014. An insatiable world appetite for precious hardwoods is threatening rare species and helping to drive deforestation in one of the last major areas of tropical forest in Asia. Photo by Ye AungChildren sitting on logs on the outskirts of Yangon May 4, 2014. An insatiable world appetite for precious hardwoods is threatening rare species and helping to drive deforestation in one of the last major areas of tropical forest in Asia. Photo by Ye Aung Thu/AFP/Getty Images.

The European Timber Regulation (EUTR) came into effect on 3 March 2013. The legislation aimed to send a message that Europe was no longer willing to be a profitable market for the illegal loggers. After a year of enforcement, and a small handful of seizures across northern Europe, the jury is definitely still out on whether that message is being sent.

Fragmentation across the EU28 has been critical to the slow start. The EUTR prohibited the sale of illegal timber, which destroys forests that are fundamental to global climate stability and sustainable development. It required any ‘first placer’ of timber or wood products on the EU market to have a system in place to ensure that the wood was from a legal source, whether domestic or imported. But a significant number of member states have not even drafted, let alone enacted, the necessary domestic legislation a year in.

By contrast with similar regulation in the US, which is enforced by a small but expert federal team, responsibilities across the EU have been given to a wide range of government agencies and little thought has been put into efficient ways to help them coordinate. For a piece of legislation that is clearly as weak as it’s weakest national enforcement link, this is a serious problem. Time will help, but inevitably limited resources and staff churn across 28 small teams will not be an easy challenge to overcome.

Since enforcement officers are scattered and often under-resourced, civil society groups have stepped in to provide the evidence necessary to stimulate seizures. On-the-ground investigations by Greenpeace and London-based campaigners Global Witness have resulted in actions by governments in Germany, the Netherlands, and Belgium. Quasi-government independent monitors REM (Resource Extraction Monitoring), operating in the Democratic Republic of Congo, have also generated vital and credible intelligence about forest crimes, which has led to enforcement actions.

In both cases, the trail of evidence led from the forest crime scene to the EU, and the investigators in question were confident that attempting to trace suspect wood back the other way would be impossible. But both campaign groups and independent monitors face increasing funding challenges as overseas development budgets are tightened across the EU and charitable donations are squeezed by austerity. 

It is also important to note that the seizures that have been made are all for simple products and supply chains – such as logs and sawn wood from the DRC, a country with weak or negligible rule of law outside the capital city. This is extremely ‘low hanging fruit’ compared with collecting similar evidence about any sort of processed product. And analysis of forest product trade data shows that ‘simple’ imports of this sort are dwindling, compared with significant and sustained growth in supply chains which take raw materials from Africa and, for example, forest frontiers in the Mekong, to processing countries such as China, for ultimate export to the EU.

These trade trends suggest that the legislation will need to be implemented much more proactively in these sectors in the medium to long term if it is to maintain credibility or have any chance of meeting its desired objective. Enforcement of the legislation in these sectors – from furniture to pulp and paper products – will represent a much more significant technical and political challenge to the supply chains that campaigners are eyeing right now.

Although the prohibition on the sale of illegal wood has generated the most interest to date, in fact that was a European Parliament addition in the final stages. From the perspective of the European Commission, the core of the regulation is the requirement for companies to have ‘risk assessment’ systems in place to identify and avoid buying potentially illegal sources of wood. They argue this will impact on a wider range of forest countries and change buyer behaviour faster.

This makes sense in theory, but in practice, the EC has been hampered by extremely limited communications budgets with which to inform the companies whose behaviour they hoped to influence. The European domestic forest sector is estimated to have a production value of €365 billion, and an added value of around €120 billion. Imports of wood products have a value of around €27 billion annually. By contrast, the communications campaign put in place by the European Commission to inform the sector – an estimated 344,000 companies, employing around three million people across 28 member states – was around €1 million. It is hardly surprising that anecdotal evidence suggests very few of these companies have any idea about their new legal responsibilities or how to meet them.

In principle there is no doubt that this sort of innovative legislation, linking environmental priorities with trade incentives, is the way forward. But innovative legislation is nothing without good old-fashioned enforcement, and that requires resources, cooperation and political pressure. Clever ideas are worth very little if they remain on paper.

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