The European Commission issued new guidance aimed at simplifying compliance with the EU Deforestation Regulation on April 15.
While the updated measures promise a significant reduction in red tape, legal experts stress that businesses will benefit from simplification of compliance requirements, not an elimination. For law firms, the EC revision doesn’t spell a slowdown for the legal advisory work opportunities linked to EUDR compliance.
IFLR spoke with Michael Littenberg, head of the ESG, corporate social responsibility and human rights compliance practice at Ropes & Gray in New York, to better understand how the changes are being received clients, what compliance challenges persist, and how the firm is advising its clients to navigate the evolving regulatory landscape.
Offering insights into clients’ reaction, Littenberg says the news was broadly welcomed.
“The many clients I have spoken with are all happy to see the EUDR compliance load lightened,” he tells IFLR.
A call answered
The EUDR, adopted in 2023, is designed to ensure that certain key goods placed on the EU market are not linked to deforestation or forest degradation. The regulation was supposed to take effect by the end of 2024, but it was delayed by one year, with full application now expected by the end of 2025.
The Commission’s decision to revise its approach comes in response to mounting pressure from the majority of the EU’s 27 member states.
Over the past year, numerous EU member states raised flags about the feasibility of the EUDR’s demands, particularly for businesses dealing with complex international supply chains.
The latest Commission guidance offers a suite of adjustments intended to reduce the bureaucratic burden of compliance.
Key simplifications include among others:
Reusing existing due diligence statements: Large companies reimporting goods already placed on the EU market can reuse prior due diligence documents, without having to resubmit information in the IT system
Representative and group authorisation: Authorised representatives may now submit due diligence statements on behalf of members of company groups. This somewhat streamlines operations for multi-entity firms
Annual reporting: Firms will be allowed to submit due diligence declarations annually rather than for each shipment or batch placed on the EU market
Clarified downstream responsibilities: Large companies downstream can meet due diligence obligations by referencing the due diligence statement numbers of their suppliers The simplifications introduced is complemented by a Delegated Act, which the EC also published on April 15. The Act provides further clarifications and simplification on the scope of EUDR, addressing stakeholders' request for guidance on specific categories of products.
“Together, all these measures will lead to a currently estimated 30% reduction of administrative costs and burden for companies,” the EC said.
Make no mistake
Rather than signalling a slowdown in regulatory obligations, the changes reflect a pragmatic attempt to make the framework more workable.
Littenberg notes that the EC’s simplification move doesn’t let companies off the hook. The obligations are still extensive — and non-compliance is not an option.
“Make no mistake about it – the EUDR will still be a big lift for many companies,” he warns.
“According to the EC, the EUDR simplification measures will, in the aggregate, result in an estimated 30% reduction in administrative costs and burden for companies. This means that 70% of the cost and burden will still be there.”
For companies already struggling to prepare, the practical benefits lie in fewer reporting touchpoints and clearer guidance on scope — but the due diligence obligations remain.
“The practical implications are less paperwork and greater scoping certainty for some goods,” Littenberg continues.
Still, key challenges have not gone away. Tracing commodity origins and ensuring responsible sourcing continue to pose difficulties, especially in regions where data transparency and enforcement mechanisms are limited.
“The EUDR due diligence obligation has not been eliminated. Covered commodities still will need to be traced and responsibly sourced,” he says.
Now is the time
With the regulation’s entry into force now just months away, legal experts are advising businesses to move away from any “wait and see” approach they might have taken until now and start acting.
“It still will be a big lift,” Littenberg argues. He adds that now that the EC has simplified the rules, a further delay of their application is unlikely.
“Affected companies that have not already done so should start preparing for EUDR compliance, which is scheduled to begin at year end,” he says.
The EUDR is one of the four pieces of regulations that are part of the EU green deal that the EC has watered down since the beginning of the year.
Earlier in February, the Commission unveiled its Omnibus Package proposals for simplification of the Corporate Sustainability Reporting Directive (CSRD), the Corporate Sustainability Due Diligence Directive (CS3D) and the EU Taxonomy, all part of the EU Green Deal.
Later in April, the European Parliament approved the changes set out in its Omnibus proposals, including a delay in the implementation of both CSRD and CS3D.
