Gain a clear understanding of the impact of the EUDR and work towards a transparent and sustainable future.
The European Union Deforestation Regulation (EUDR)
The new European rules for deforestation-free products
From the end of 2026, EUDR obligations will apply. Companies falling under this regulation must therefore prepare to meet the requirements regarding data management, supply chain due diligence, and the associated systems and processes.
Key compliance focus areas include traceability, supplier involvement, data availability, governance, and IT systems.
Would you like to know more about the best-practice approach for the EUDR, or do you need support with preparation and alignment with other sustainability regulations? Feel free to contact us for more information.
The EU Deforestation Regulation – the key points in brief:
- What is EUDR?
- Why is the EUDR important?
- Non-compliance with the EUDR: what are the consequences?
- Who must comply with the EUDR?
What is EUDR?
The EUDR imposes a ban on the placing on the market, making available on the market, importing, and exporting relevant products unless they are deforestation-free, produced in accordance with the relevant legislation of the country of production, and accompanied by a due diligence statement or simplified declaration.
The raw materials to which the EUDR applies are cattle, soy, palm oil, coffee, cocoa, rubber, and wood, and additionally a specifically defined list of derived products, such as: leather, rubber drive belts, conveyor belts, and spare parts, but also various oils, glycerol and (industrial) acids, paper, cardboard packaging, wooden furniture, and coat hangers.
Please note that on 4 May 2025 the European Commission proposed changes to the scope, among others by excluding leather from EUDR obligations and including soluble coffee and palm-oil derivatives (such as soap) in scope of EUDR. Whether these proposed changes will be effectuated will become clear at a later stage.
Companies placing relevant products on the market are required to establish a due diligence system consisting of procedures and measures to comply with information requirements, risk assessment measures, and, where the situation requires, risk mitigation measures. The due diligence statement or simplified declaration forms the final component of this.
Why is the EUDR important?
Deforestation contributes significantly to climate change, biodiversity loss, and the degradation of natural ecosystems. With the EUDR, the European Union aims to ensure that relevant products placed on the EU market or exported from the EU have not contributed to deforestation or forest degradation, regardless of where they are produced.
The regulation thus constitutes an important instrument to support European climate objectives and international agreements on sustainability and nature conservation.
Non-compliance with the EUDR: what are the consequences?
Failure to comply with the EUDR has direct consequences. Non-compliant products are not allowed to be imported, exported, placed- or made available on the market. A product already placed on the market must be withdrawn or recalled, which can lead to supply chain disruptions, financial consequences, and reputational damage.
In addition, companies risk severe sanctions. These include fines commensurate with environmental damage and the value of the affected products, seizure of goods and proceeds, and (temporary) exclusion from tenders and public funding. Furthermore, upon final decisions, the company's name, the violation, and the sanctions are made public via the European Commission's website.
Who must comply with the EUDR?
The EUDR is relevant to all companies trading goods listed in Annex 1 of the Regulation, even if they are not 'operators'. 'Downstream operators' and 'traders' may also face consequences if goods in their chain are found not to comply with EUDR requirements and, for example, products need to be withdrawn from the market. See also 'non-compliance'.
EUDR under control: together towards a deforestation-free future
PwC offers support ranging from end-to-end implementation partner to targeted ad-hoc support. Below is a selection of the possibilities.
Scope Assessment
EUDR compliance begins with clearly defining the scope: which products fall under the regulation? This concerns not only core products within the product portfolio, but also related products (such as spare parts and packaging) based on EUDR-relevant raw materials or derived products.
The role in the supply chain (operator, downstream operator, or trader) together with the country where the commodities are harvested, subsequently determines which obligations apply, such as establishing a due diligence system, submitting due diligence statements or collecting information and due diligence statement numbers, and ensuring traceability, for example through effective batch management.
PwC can act as a sparring partner in this process or take the lead to clarify which obligations apply, what the minimum requirements are, and where potential bottlenecks lie. If desired, this can be translated into a targeted gap assessment, providing a practical and substantiated picture of what is needed to become EUDR-compliant.
Tools and Technology
EUDR compliance requires high standards on data quality, traceability, and due diligence. With multiple product streams and suppliers, manual solutions may not be sufficiently scaled. Appropriate tooling and a well-thought-out technological landscape can therefore be essential to efficiently and demonstrably safeguard EUDR requirements.
During the preparation phase, PwC can also assist in translating EUDR and business requirements into clear functional and technical requirements and help select fit-for-purpose solutions. We identify relevant use cases, leverage synergies with existing systems and other laws and regulations (such as CSRD, packaging, etc.), and guide technology selection processes from requirements to tooling that fits the organization and the existing IT landscape.
Implementation
PwC supports organizations in effectively embedding the EUDR requirements into day‑to‑day operations. Following the assess and prepare phases, we translate compliance requirements into concrete processes, roles, and ways of working, ensuring they are practical and workable across both the organization and the supply chain.
We support the design and implementation of the due diligence system, the development of an operational blueprint, and the establishment of a robust and auditable audit trail. In addition, we actively support stakeholder management, with a strong focus on engaging and informing suppliers, clearly communicating EUDR requirements, and ensuring that suppliers provide the correct and complete information in a timely manner. This is translated into a clear implementation roadmap, aimed at step‑by‑step, manageable, and sustainable EUDR compliance.
Maintain & Evolve
EUDR compliance does not end after implementation. PwC supports organizations in embedding and further developing their EUDR framework. We assist with monitoring regulatory and legislative developments, assessing and following up on substantiated concerns, and performing periodic (annual) reviews of the compliance framework.
We can also support organizations in managing changes in the upstream supply chain, such as onboarding new suppliers, changes in countries of origin, or adjustments to sourcing strategies. A strong supplier engagement approach and real‑time visibility into the supply chain are essential in this respect, as are clear agreements on the timely and accurate provision of information.
Frequently Asked Questions (FAQ’s)
EUDR – Is your company ready for compliance?
The application date of the EU Deforestation Regulation will be extended to 30 December 2026. Our flyer helps you understand the implications and assess your company’s progress and priorities.
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