The European Commission has released its simplification review of the EU Deforestation Regulation (EUDR), highlighting that changes introduced since the law’s rollout have reduced company compliance costs by about 75%. Most of these savings come from simplified requirements for small and micro businesses.
The review also proposed limited scope adjustments, notably removing leather imports from the regulation, while largely keeping the core framework and timeline intact. This helped ease concerns among environmental groups and companies already preparing for compliance. First proposed in 2021 and adopted in 2023, the EUDR aims to eliminate deforestation-linked products from the EU market, covering commodities like palm oil, beef, timber, coffee, cocoa, rubber, and soy, along with some derived products.
The regulation requires companies to conduct strict due diligence, including tracing products back to their origin to ensure they are not linked to deforestation after 2020 and comply with local laws. Although initially set to apply in 2024, implementation has been delayed to end-2026 for large companies and mid-2027 for smaller ones to allow more preparation time.
As part of the latest review, the Commission also proposed adding certain downstream products like soluble coffee and some palm oil derivatives, while excluding others such as leather, retreaded tires, packaging materials, and second-hand goods.
Overall, the Commission estimates that annual compliance costs have dropped from €8.1 billion to €2.0 billion. The regulation is already showing positive effects, including increased investment in supply chain traceability, improved transparency, and new opportunities for deforestation-free products.
