Does the European Deforestation-free Regulation (EUDR) apply to non-EU companies?

Question

Is an Indonesian furniture maker supplying kitchen furniture into the EU an “operator” for the purposes of submitting the due diligence questionnaire or are only its EU distributors/customers the “operator”? What are the obligations of companies from third countries?

Under EUDR, Article 2(15), “operator” is defined as any natural or legal person who, in the course of a commercial activity, places relevant products on the market or exports them.

In your case, you are an Indonesian furniture making company supplying kitchen furniture into the EU. By definition, you are also classified as an “operator”.

However, the obligations to exercise due diligence and submit the due diligence statement to demonstrate that (1) the products are deforestation-free and (2) the products have been produced in accordance with the relevant legislation of the country of production are only applicable to operator established in the European Union. It means, in the case of a legal person or an association of person, any person whose registered office, center headquarters or a permanent business establishment is in the EU (see EUDR Article 2(21)).

There are no legal obligations applicable to non-EU countries. The Regulation sets out obligations for operators and traders (see chapter 2 of the Regulation) as well as for the EU member states and their competent authorities (see chapter 3 of the Regulation). Because Indonesia is not a member of the EU, you do not need to do so. It also clearly states in Article (7) Placing on the market by operators established in third countries:

“Where a natural or legal person established outside the Union places relevant products on the market, the first natural or legal person established in the Union who makes such relevant products available on the market shall be deemed to be an operator within the meaning of this Regulation.”

However, to facilitate the trade, you should provide the information as requested by your trading partners in the EU for them to be able to comply with EUDR. Your business will undoubtedly stand out from the competition if you can demonstrate that you are willing and able to supply the following information:

(1) the geolocation coordinates and documents to prove the legality of relevant commodities or products of your company;

(2) segregation of EUDR-relevant commodities and products from unknown origins to avoid the risk of mixing;

(3) traceability of your commodities or products to their origin.

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