EUDR Guidance Update: Providing Simplification & Consulting Clarification

Deforestation causes many significant adverse effects on the planet, such as accelerating hazardous human-induced climate change, losing biodiversity, and less climate resilience. Whilst the famous author J.R.R. Tolkien created the Ents (i.e. humanoid tree-like spirits) in his stories to protect the trees, the ‘European Union’ (EU) adopted the (consolidated) ‘EU’s Deforestation Regulation 2023/1115’ (EUDR) to protect the earth’s forests against deforestation and degradation. In addition, the EUDR aims to reduce the EU’s contribution to greenhouse gas emissions and prevent global biodiversity loss. 

On 15 April 2025, the Commission updated the EUDR’s FAQ Document (previous version October 2024) and its EUDR Guidance Notice (hereinafter jointly referred to as: EUDR Guidance) to support companies in their effort to ensure compliance with the EUDR’s upcoming obligations. The Commission also published the draft Commission Delegated Regulation for consultation. In short, the Commission intends to amend the list of relevant commodities and products under Annex I EUDR by introducing limited and targeted technical fixes. In this blog post, we share the main insights of the Commission’s latest guidance on the EUDR.

The EUDR – a brief recap 

The EUDR addresses worldwide deforestation by banning certain high-risk products that are not deforestation-free from being traded on its internal market. Although the EUDR entered into force on 29 June 2023, most of its provisions applying to companies, however, become applicable as of 31 December 2025 due to the postponement of the original applicability date of 31 December 2024 by Regulation 2024/3234. By postponing the EUDR’s applicability, the EU provides companies time to make the necessary preparations in their supply chain for ensuring compliance. For micro-undertakings or small undertakings (SMEs), the provisions of the EUDR become applicable as of 30 June 2026. 

As we set out in a previous blog article, the material scope of the EUDR encompasses particular commodities identified in Article 2(1) EUDR, namely: cocoa, coffee, palm oil, soy, wood, cattle, and rubber (which list can be extended following the EUDR’s review by the Commission after a period of two years). 

In addition, products that are derived from these commodities and are listed in Annex 1 EUDR also fall within the scope of the EUDR. The production of these relevant commodities (and their derived listed products) requires a huge amount of agricultural land and is, therefore, seen as the main driver behind deforestation. 

Briefly put, the EUDR requires that in-scope commodities and derived products cannot be placed on the EU-market, unless it can be demonstrated that they are:

1. Deforestation-free;
2. Legally produced; and 
3. Accompanied by a ‘due diligence statement’ (DDS).

Regarding the personal scope, the EUDR applies to large 'operators' (those who place the listed product or relevant commodity on the EU market for the first time) and 'traders' (those who make the listed product or relevant commodity further available to the market). the EUDR applies to these market participants, regardless of the location of their legal establishment and their legal form. 

1. Clarifications 
2. Scope and obligations 

Most notably, the Commission clarifies that the EUDR’s due diligence obligations apply to individual entities not to groups of companies: 

“persons’ in accordance with Art. 2(20) EUDR, regardless of whether they are members of a company group or not.” 

A related clarification relates to determining whether an undertaking qualifies as an SME or not. In that regard, the EUDR Guidance states that for calculating the thresholds in accordance with the consolidated Annual Accounting Directive 2013/34 (AAD), only the balance sheet, net turnover, and number of employees thresholds of the individual legal entity should be taken into account and not of the entire group. However, the EUDR Guidance does allow operators and traders to mandate an authorised representative (entity) to submit and manage due diligence statements on behalf of all members of the group. Moreover, an authorised representative is allowed using a single account to submit and manage DDS on behalf of all entities it represents. 

Furthermore, the Commission updated the requirements pursuant to Article 12(3) EUDR for non-SME operators relating to their reporting obligations on compliance with the EUDR.  Recognising that companies could be subject to the EUDR’s annual reporting obligations, while they at the same time are being (temporarily) exempted from the CSRD’s reporting obligation due to adoption of the Omnibus I ‘Stop-the-Clock’ proposal (read here) –  and could be further exempted in the future from the scope of the CSRD/CSDDD. In light of the current applicability date (i.e. 31 December 2025), the first report (covering the year 2026) will have to be published after 30 December 2026.

Simplifications 

The EUDR Guidance provides more clarity on the scope and obligations of the EUDR but is also aimed to providing companies, Member States' authorities, and third countries with additional simplified measures and clarifications on how to demonstrate that products are deforestation-free. Against the background of the ongoing debates on “cutting the red tape” of various ESG measures to unburden industry, the Commission’s proposals to simplify the obligations under the EUDR will not be surprising. According to the Commission’s press statement, the proposed measures will reduce the administrative costs and burden for companies with 30%.

Reducing downstream DDS requirements

The main important simplification applies to so-called non-SME downstream ‘operators’ and traders, which we explain under the figures below.

Non-SME downstream operators are ‘large undertakings’ (within the meaning of Article 3(4) AAD who (1) place for the first time in-scope products (commodities or derived products) on the EU market that (2) were already subject to a ‘due diligence statement’ (DDS) from, for instance, an (upstream) importer. 

Figure 1: (non-SME) downstream operator              

Importing cacao beans in the EU (operator)           Producing / selling chocolate in the EU (operator)

1^st placing on the market                                             2^nd placing on the market

Non-SME ‘traders’ make the said products further available on the market (by selling them to customers). Both (non-SME) downstream operators and traders are allowed to reuse existing due diligence statements when goods, previously on the EU market, are reimported.

Figure 2: non-SME trader

Producing chocolate (operator)                             Selling chocolate products (trader)

Placing on the market                                              Making available on the market

The updated EUDR Guidance, particularly, clarifies the simplified DDS obligations on re-importers (i.e. companies importing a previous exported relevant product listed under Annex I EUDR outside the EU that were at the time of exporting already subject to a DDS). 

Figure 3: re-importer     

Producing Chocolate (producer)    Exporting Chocolate         Importing Chocolate (operator)

1^st placing on the market                                                               2^nd placing on the market

According to the updated EUDR Guidance, re-importers are considered “downstream operators” in case they are re-importing products that were previously exported from the EU by placing them under the customs procedure ‘release for free circulation’ and, subsequently, (re)place these products for the first time on the EU’s internal market. As ‘downstream operators’, the EUDR’s obligations vary depending on the size of the company:

• SME re-importers are not required to carry out due diligence at all and must provide the reference number(s) from their supplier(s) in the customs declaration
• Non-SME re-importers (i.e. ‘large undertakings’ ) can rely upon already existing due diligence statement (DDS) of the product.

Combined due diligence statements

Companies will be allowed to submit due diligence statements annually instead of for every shipment or batch placed on the EU market. In that regard, the updated EUDR Guidance provides that a DDS can cover multiple physical batches/shipments – provided that due diligence was carried out for all the concerned relevant products in accordance with the corresponding mentioned quantity and that the DDS covers is not older than one year from the time of submission of the statement.

Consultation 

The Commission also announced a public consultation on its draft Delegated Regulation to clarify the scope of the EUDR and to propose specific limitations. Interested parties can submit their feedback to the Commission up to and including 13 May 2025.

Regarding the clarifications, the Commission’s explained that certain codes relating to in-scope products also include product codes that are made from non-relevant commodities. In that regard, Annex I EUDR should only encompass relevant products. By adding ‘ex’ in front of certain products (for example, ‘ex 4401 Fuel wood’), the Commission hopes to make clear that only the listed products that are solely made from a relevant commodity (i.e. ‘Wood’) are subject to the EUDR’s obligations. Furthermore, the Commission proposes to exempt samples of products and products used for examination, analysis, and testing from the EUDR.

What does this mean?

While a lot of EU ESG legislation is currently up for discussion, the Commission is still set to let the EUDR become applicable towards operators and traders at the end of 2025. The published simplifications and clarifications allow companies to prepare for the EUDR (insofar they have not already done this). The Commission’s approach shows that, despite a slight drawback in the Omnibus-I Initiative, ESG legislation is here to stay including compliance and reporting obligations. As the Commission already observed on the interaction between the CSRD/CSDDD and the EUDR, one may wonder whether amending the CSRD’s and CSDDD’s scope will not make ESG compliance more complex due to the overlapping sustainability risks throughout the supply chain. Of course, ensuring a sustainable supply chain and business model is intensive, requires investments, and is complex. It requires a revision and cooperation by both large and SME undertakings. However, by providing a harmonised and aligned regulatory ESG framework, a step is made to ensure a level-playing-field for ESG compliance that is balanced and fair, though effective in attaining the goals of the EU Green Deal. 

Interested to see how your organisation can ensure compliance with the EUDR, by all means reach out to Pauline Kuipers, Nicolas Carbonelle, or Sander Wagemakers.