An independent evaluation concludes that Europe’s action plan to clamp down on the trade of illegally sourced wood products is working, though the plan requires some adjusting to face new types of challenges. This news comes on the heels of Indonesia’s announcement that it will be the first nation to issue timber products licensed under that action plan.
24 May 2016 | Earlier this month, a team of eight experts assessed years of research in an independent evaluation on the European Union’s action plan to curb illegal logging, known formally as the Forest Law Enforcement, Governance and Trade (FLEGT) Action Plan.
Their conclusion: while FLEGT is achieving its goal of decreasing the amount of illegal wood entering the European Union, it’s not clear that it’s succeeding in its goal of promoting sustainable forest management, and it faces new challenges around illegal deforestation and forest conversion.
The findings relating to the trade in illegal wood are supported by those emerging in an informal survey that Ecosystem Marketplace publisher Forest Trends has recently conducted with EU, US, and Australian governments, says Jade Saunders, a Senior Policy Analyst with the organization’s Forest Policy, Trade and Finance program. “We asked them about their enforcement of relatively new legislation aiming to reduce market access for high risk and illegal wood,” she explains.
The survey results, which will be released shortly, are expected to show that Australian, EU and US agencies are stepping up their enforcement efforts, and observing companies changing the way that they buy forest products.
“As officials in Europe, North America, and Australia continue to enforce the laws on their books, we look to other governments to join the growing united front that’s clamping down on illegal timber being extracted from endangered forest areas around the world,” says Kerstin Canby, the Director of Forest Trends’ Forest Policy, Trade and Finance program.
What is FLEGT?
The European Union is one of the world’s largest consumers of timber products, and it developed the FLEGT Action in 2003 to lay out actions that could be taken at the European level, and by individual member states, to stem the tide of illegally sourced timber entering the EU market.
Though dubbed an “action plan”, the report describes FLEGT as a broad-based framework aimed at implementing policies to stem both the supply and demand of illegal wood. On the demand side, the policy outlines several options, one of which is making a legal obligation for responsible sourcing by private companies (the EU Timber Regulation (EUTR), which came into effect in 2013 and prohibits groups from placing illegal wood in the EU market). Another is by encouraging requirements for legality and sustainability standards in public procurement policies that relate to forest products. The Action Plan also laid out the framework for FLEGT Voluntary Partnership Agreements (VPA), bilateral trade agreements with timber-producing countries to promote the trade in legal wood products.
The independent evaluation, which assesses FLEGT’s implementation from 2004 to 2014, draws 10 conclusions and recommendations to shape the plan’s future activities. Chief among these, they say, are the needs to strengthen monitoring activities and encourage more private-sector involvement, which the authors note should be achieved through a broader scope that focuses on international coalitions.
“FLEGT is at the forefront of the fight against illegal logging,” wrote Neven Mimica, the EU Commissioner for International Development, in a blog post. “Of course, there is much more work to be done, but as the evaluation and experiences on the ground show, FLEGT is on the right track.”
Cross-Border Data Sharing
The upcoming Forest Trends enforcement survey draws upon data collected from 14 EU member countries, as well as US enforcement agencies and Australia’s Department of Agriculture and Water Resources, who voluntarily disclosed information on their own enforcement activities related to the EUTR, Lacey Act and Illegal Logging Prohibition Act (ILPA).
The Lacey Act is a US law that bans the trade of illegal wildlife, including timber products, and was the world’s first ban on illegally sourced wood products trading. And the ILPA is Australia’s illegal logging laws, mandating due diligence and making it a crime to intentionally import wood, pulp and paper products into the country that have been illegally harvested.
Back in the EU, member governments have conducted 495 site inspections and 712 due diligence reviews, ultimately issuing 300 corrective action requirements, four injunctions, and 55 sanctions, the survey data shows.
Moving Slow or Right on Track?
In the past, EU Member States have been criticized by NGOs for being slow to implement the EUTR, but Saunders says enforcement has progressed relatively quickly compared with other regulated sectors.
“It has only been in operation since 2013 and changing whole industries in this way is a slow and complicated business,” she says.
She believes Member States implementing the EUTR have come under pressure because they have failed to record a “big bust” the way US authorities did when they charged the hardwood flooring company Lumber Liquidators with violating the Lacey Act.
But comparing the EUTR to the Lacey Act in this way is a matter of apples and oranges, Saunders says, because of the different legal approaches and the level of data protection surrounding enforcement in Europe.
“It’s not as easy to talk about companies being subject to sanctions in the EU as it is in the US,” she says. “Yet this new data shows that hundreds of them have been put under pressure by the authorities to change the way they source forest products in the last six months.”
No to Illegal Wood
She documents some of this pressure in a blog post, writing that Sweden and the Netherlands may be sanctioning two companies after they imported wood from Myanmar and Cameroon allegedly without performing proper due diligence.
These first cases show that European regulators are willing to face the challenge of enforcing this complex new law, Saunders wrote.
Naming and Shaming
The still-unpublished survey also identifies forested countries implicated in the recent corrective actions and sanctions. They include Brazil, Peru, Democratic Republic of Congo, Russia and Ukraine, with 30% of the actions reported affecting supply chains in China, Thailand, Malaysia and Vietnam, where the products are processed, according to the research. Enforcement agencies issued 62 Corrective Action requirements, injunctions or sanctions to importers of furniture in the last six months alone.
“These actions send an unequivocal message that key importer countries are saying ‘no’ to illegal wood,” Canby says.
New Spin on the Same Problem
As for FLEGT adjusting to meet new challenges, several of these new trials are coming in the form of agricultural expansion that is now a massive driver of deforestation. The Ecosystem Marketplace/Forest Trends online tool tracking corporate sustainability commitments, Supply Change, says commercial agriculture, largely from such products as soy, beef, timber and palm oil, drives at least 70% of tropical forest loss. Saunders notes that a lot of the forest clearance to make way for this agricultural production has been illegal and export driven. According to a Forest Trends report, 49% of tropical deforestation between 2000 and 2012 was due to illegal conversion for commercial agriculture. And nearly a quarter of that was the direct result of illegal agro-conversion for export markets.
Because of its substantial and growing impact, FLEGT should have the capacity and mechanisms needed to address illegal deforestation from agriculture, experts say.
Penny Davies, a Program Manager at the Ford Foundation, previously a Senior Forestry Advisor for the British government’s Department for International Development, believes FLEGT’s integrated policy approach serves as a good model to address the forest-risk commodities challenge.
“The action plan is development assistance aligned with trade rules aligned with governance and regulatory frameworks, and instead of these rules being imposed by a European country, it’s a mutually agreed partnership,” she said in a Climate Wire article. And this type of unifying agreement could be used to tackle the trade of palm oil or soy that is produced on illegally cleared land.
Using Purchasing Powers for Good
In addition to the roll-out of independent research related to FLEGT’s progress and effectiveness, Indonesia and the European Commission announced in April that Indonesia is in the absolute final stages of fulfilling its VPA requirements and will issue FLEGT licenses on its timber products, many of which ends up in the EU market. The United Kingdom provided technical training and funding, helping Indonesia establish a nationwide timber legality assurance system that has audited more than 20 million hectares of forestland over 1,700 businesses. In 2002, just 20% of Indonesia’s timber exports were considered legal, the EC announcement says, and now, 90% of those exports come from independently audited factories and forests with plans in place to audit the remaining portion in the coming months.
Indonesia is one of 15 nations engaged in a VPA process which altogether represents 80% of the tropical timber imported into the EU. While not as far along as Indonesia, Ghana is another country in the late stages of implementing a timber legality assurance system, a fundamental component of a FLEGT licensing process.
“Indonesia and its partners in the EU have shown that trade can provide incentives towards ending the scourge of illegal logging,” Karmenu Vella, the European Commissioner for Environment, Maritime Affairs and Fisheries said in a news release.
Saunders says it’s nice to see actions on both the demand and supply side of this coming to fruition after nearly 15 years of effort. The FLEGT Action has been enabling buyer countries to contribute to legal and sustainable forest management through the wood they’re purchasing, she says, which is a powerful thing.
Kelli Barrett is a freelance writer and Editorial Assistant. She can be reached at [email protected].
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