Designed to curb tropical deforestation, the EU Deforestation Regulation (EUDR)’s extraterritorial reach is forcing exporters and global supply chains to rethink traceability, data governance, and compliance infrastructure. The December 2026 deadline is closer than it appears.
Between 2019 and 2021, EU imports were associated with an average of 190,500 hectares of deforestation per year, roughly 15% of all deforestation linked to direct global trade, with cocoa alone accounting for a third of the EU’s total deforestation exposure. The EUDR, adopted in June 2023 as part of the Green Deal, is Europe’s legislative response. It covers seven commodity groups: cattle, cocoa, coffee, palm oil, rubber, soy, and wood, plus their derivatives.
The regulation prohibits the import into, and export from, the EU of products linked to deforestation occurring after 31 December 2020, or to illegal production practices. Companies must file due diligence declarations demonstrating that their products are deforestation-free and comply with local laws in the country of origin. Those local laws extend well beyond environmental protection. The regulation requires compliance with the country of production’s legislation on land use rights, forest management, labour rights, human rights protected under international law, and tax, anti-corruption, trade, and customs regulations. It also requires respect for the principle of free, prior and informed consent (FPIC), which means indigenous peoples must be consulted and give their consent before land is used for commodity production. This means the regulation’s due diligence requirements go significantly beyond deforestation, encompassing the full legal context in which commodities are produced.
Under the current timeline, compliance dates are 30 December 2026 for large and medium enterprises, and 30 June 2027 for SMEs.
The EUDR was designed primarily to combat tropical deforestation in regions such as Brazil and Indonesia. But its extraterritorial reach sweeps in producers worldwide, including the United States, one of the EU’s largest suppliers of agricultural commodities.
For exporting countries across the Americas, Africa, and Southeast Asia, the challenge is structural. Supply chains for timber, soy, cattle, and other covered commodities are rarely vertically integrated. Few existing systems capture plot-level geolocation data at the granularity the regulation demands. The regulation’s cutoff date of 31 December 2020 adds a further layer: companies must demonstrate that no deforestation has occurred on their source plots for over five years, often for land they have never directly managed, using satellite imagery, historical land-use records, or equivalent evidence.
Countries are assigned risk classifications under the regulation’s benchmarking system, which determines inspection frequency. But classification does not change the compliance obligation. A timber exporter in a low-risk country must still demonstrate full traceability, provide geolocation data, and file due diligence declarations. The difference is how often regulators check, not whether the rules apply.
Beyond the timeline extension, the European Commission introduced amendments that recalibrate obligations across the supply chain. The regulation now distinguishes more precisely between first operators (the first party to place a product on the EU market), downstream operators, micro and small primary operators, and traders. This matters because it determines who bears the burden of a full risk assessment and who can rely on upstream declarations.
Downstream operators no longer submit their own due diligence reports when products are already covered by a valid upstream declaration. Micro operators and small primary operators in low-risk countries may provide a postal address rather than precise GPS coordinates under a simplified one-off declaration.
These adjustments reduce administrative overhead in specific parts of the chain. But they do not soften the regulation’s core requirements: proof of absence of deforestation, full traceability, and demonstrated legality of production. Interpreting these amendments as a relaxation of the rules would be a strategic error. Controls are becoming more targeted and more technical, and companies must be able to justify product compliance retrospectively, sometimes several years after a product has been placed on the market.
The procedural simplifications may create an impression of ease. In practice, the compliance challenge has shifted from form-filling to evidence-building, and for many companies, that is harder.
All declarations must be submitted through TRACES NT, the EU’s information system originally built for animal and plant health controls, now repurposed for EUDR. The system is a submission portal, not a compliance tool: it does not store supplier data between filings, does not provide satellite imagery, and does not perform risk assessments. Companies must build or procure their own infrastructure, whether through dedicated deforestation monitoring platforms, extensions to existing supply chain tools, or a combination to prepare declarations before filing them. In cases of substantiated doubt about a product’s compliance, the regulation requires operators to immediately notify the competent authorities of the relevant Member State, downstream operators and traders who have received the product, and, in the case of exports, the competent authority of the country of production. The enforcement architecture is designed to cascade accountability through the chain.
The EUDR applies to supply chains characterised by significant diversity: multiple countries of origin, varying risk levels, different commodities, and suppliers at different stages of readiness. A blanket approach to compliance is unlikely to work.
A multinational food company sourcing soy from the Americas, palm oil from Southeast Asia, and cocoa from West Africa faces three very different risk profiles under the same regulation. Effective compliance requires segmenting, prioritising, and tracking across this heterogeneity.
Traceability systems built for domestic compliance may lack the land-use history that European regulators require. And for companies already managing supply chain decarbonisation through platforms like Resource Advisor+, the supplier data challenge is not new, but the EUDR adds a layer of granularity that most existing systems were not designed for.
The EUDR reflects a wider trend: sustainability regulation is becoming supply chain regulation. The same data infrastructure, traceability, geolocation, land-use history, supplier evidence that the EUDR demands will underpin climate disclosure rules, Scope 3 reporting, and nature-related risk assessments.
European regulatory ambition tends to create de facto global standards. Companies that build data and governance capabilities to meet EUDR requirements will find those capabilities directly applicable to the Corporate Sustainability Due Diligence Directive (CSDDD), which entered into force in 2024 and begins applying to the largest companies from 2028.
This is the approach we take with our clients. Alignment with the EUDR is not limited to a single check. The same product reference may cover several supply scenarios, with different chains, roles, and responsibilities depending on whether you are a downstream operator, trader, processor, or producer. We work scenario by scenario:
Our work is grounded in the Accountability Framework, a roadmap to help companies build supply chains free from deforestation, conversion of natural ecosystems, and human rights violations. It was created by the Accountability Framework initiative (AFi), led by a coalition of more than 20 environmental and social NGOs. As an AFi delivery partner, we use the Accountability Framework to structure risk assessments at multiple levels and ensure consistency between EUDR requirements, climate objectives, and reporting commitments.
Supply chain transparency requirements will deepen. The EU Nature Restoration Law (in force since August 2024) requires Member States to submit National Restoration Plans by September 2026. The same window companies are preparing for EUDR compliance. Both regulations sit under the EU Biodiversity Strategy for 2030, and the direction is consistent: the EU is tightening requirements on deforestation from imported products while setting binding restoration targets at home. Companies that build their EUDR data infrastructure with this trajectory in mind will avoid starting over when the next deadline arrives. If you are not sure where your gaps are, that is where we start.
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