On 17 November 2021, in the wake of the Glasgow Climate Change Conference (COP26), the European Commission (“Commission”) presented its Proposal for a Regulation that aims to curb deforestation and forest degradation driven by European Union (“EU”) consumption and production (“Proposed Regulation”). The wider goal of the rule is to reduce greenhouse gas (“GHG”) emissions and global diversity loss, by minimising the consumption of products from supply chains associated with deforestation or forest degradation.

Already announced in 2019, the Proposed Regulation fits in the wider context of the European Green Deal, the Commission’s flagship initiative to transform the EU from a high- to a low-carbon economy. It follows similar initiatives in the United States (“U.S.”) and United Kingdom (“UK”), as discussed in more detail here.

The Proposed Regulation complements and expands on existing EU legislation, such as the EU Timber Regulation (“EUTR”) and the Forest law Enforcement, Governance and Trade Regulation (“FLEGT Regulation”), and would be complementary to the Commission’s legislative initiative on Sustainable Corporate Governance (“SCG”). Of note, it would integrate and improve the framework created by the EUTR, which would be repealed by the adoption of the Proposed Regulation.


Continue Reading The European Commission’s Proposed Ban on Products Driving Deforestation and Forest Degradation

On October 6, 2021, Senator Brian Schatz (D-HI) and Representatives Earl Blumenauer (D-OR) and Brian Fitzpatrick (R-PA) introduced the Fostering Overseas Rule of Law and Environmentally Sound Trade (“FOREST”) Act of 2021 to “deter commodity-driven illegal deforestation around the world.”

The FOREST Act aims to disincentive illegal deforestation by restricting certain commodities and derivative products originating from illegally deforested lands from accessing the U.S. market.  If the FOREST Act is passed by Congress, foreign producers of “covered commodities,” such as: palm oil, soy, cocoa, cattle, rubber, and wood pulp, as well as foreign companies that produce products that are wholly or partially derived from these commodities will be affected by the new legislation.

A similar deforestation proposal has been introduced in the United Kingdom, and another is expected to be published by the European Commission under a proposed Regulation on November17, 2021.  As some of the largest consumers of agricultural commodities, the introduction of deforestation legislation in the United States, the United Kingdom, and the European Union could be the start of a larger global effort to address one of the most environmentally harmful practices using trade measures.  Depending on their terms and how they are implemented, the FOREST Act and its counterparts in the EU and UK could have negative implications for foreign producers and primary exporting countries of the commodities, if passed into law in any of these three jurisdictions.


Continue Reading Potential Implications of the FOREST Act of 2021 and Related Developments in Other Jurisdictions