Hardening international soft law frameworks into EU measures to address forest-risk commodities
Between 1990-2008, 80 per cent of deforestation was caused by commodity-driven expansion of commercial agriculture, and the European Union was the leading importer of these forest-risk commodities (‘FRCs’), which include palm oil, beef and leather, soy, cocoa, and timber.
The EU has acknowledged the need for the EU to develop policy proposals to address the environmental impacts of EU consumption of food and non-food commodities as a key component of fulfilling the EU’s pledge to tackle global deforestation and forest degradation.
EU policymakers are now in the process of taking up this challenge, and this paper provides inputs to these policy discussions. It proposes a toolbox of recommended supply-side and demand-side measures including:
- Fully utilising instruments already available through the Forest Law Enforcement, Governance and Trade (FLEGT) Action Plan - Voluntary Partnership Agreement (VPA) processes, timber procurement policies, and the EUTR - to address forest conversion in violation of local laws including communities’ land and forest tenure rights. Studies have shown that the majority of the tropical deforestation that zero-deforestation pledges seek to halt is illegal in some way.
- Supporting the development of guidelines defining how ‘deforestation free’ commodity supply chains could be achieved. This could be developed through existing international platforms and forums seeking to operationalise companies’ ‘zero-deforestation’ commitments and then incorporated into the Organisation for Economic Cooperation and Development – Food and Agricultural Organisation (OECD-FAO’s) Guidance for Responsible Agricultural Supply Chains.
- Adopting a third-country carding system to promote implementation of Tenure Guidelines by producer countries. This would be modelled on the third-country carding system being implemented under the EU Regulation to end illegal, unreported and unregulated (IUU) fishing (‘IUU Regulation’). A carding system to promote implementation of the VGGT would need to begin with the development of a baseline assessment for each partner country, showing existing measures for securing and protecting tenure. It would be followed by a roadmap developed by each partner country which could, in turn, be monitored and supported to ensure good progress. The Commission should make material publicly available, including: country assessments of their legal frameworks and administrative systems governing tenure; Commission fact-finding missions; and country roadmaps for bringing practices in line with the Voluntary Guidelines on the Responsible Governance of Tenure of Land, Fisheries and Forests in the Context of National Food Security (VGGT) principles and recommendations. This would not only foster accountability, but also provide very useful information for operators exercising due diligence in reference to VGGT principles.
- Supplementing the proposed carding system with development assistance and other resources. These resources should go to producer country governments and key stakeholder groups, in particular land and forest tenure holders. Support should also be given to CSOs and NGOs that help tenure holders to secure their rights, and support law reforms and other governance improvements needed to implement the VGGT.
- Requiring EU operators trading FRCs to exercise due diligence in relation to whether the land on which the commodities they trade were cultivated was converted from forests in violation of tenure rights. The proposed due diligence measure would be similar to the due diligence obligations that the EUTR imposes on operators who first place timber or timber products on the EU. It would require operators to either (1) trace their commodity supply chain back to the farm, and be reasonably confident that the land on which the commodities were cultivated was not converted in violation of tenure rights, or (2) be reasonably confident that every entity in their supply chain exercises due diligence to ensure that the commodities were not cultivated on land that was converted in violation of tenure rights.
- Ensuring that due diligence remains the responsibility of economic operators trading in forest-risk commodities (and products that incorporate these commodities) and are not displaced onto voluntary certification schemes or other third parties. Blacklists of rogue plantations, processors, and other links in the supply chain, as well as whitelists of transparent, well-monitored supply chain actors that demonstrate best practices for adhering to the VGGT, could be developed to aid downstream operators’ in their exercise of due diligence. But any assistance – whether in the form of whitelists, blacklists, industry schemes, or other tools – cannot release upstream or downstream operators from their due diligence obligation. In other words, compliance tools such as certification schemes and whitelists should be viewed as providing assistance and evidence to support a company’s exercise of due diligence, not substituting for it.
- Requiring operators to publicly report on their commitments and actions to implement the VGGT. Mandatory reporting laws should require companies to monitor their efforts to implement their stated commitments – that is, monitoring of the procedures used to fulfil companies’ compliance promises, not just the existence of the promises. Requiring operators to publicly state how their operations adhere to the VGGT principles and standards creates a duty of care. It also allows external stakeholders to expose instances where the VGGT are not met.
- Requiring Member State competent authorities to investigate and prosecute EU nationals or EU-based companies that benefit from illegal land conversion in producer countries by financing or operating companies, along the lines of the IUU Regulation.
In addition, please find below "Can an EU Human Rights Due Diligence Regulation help us tackle deforestation and respect human rights?", a discussion paper stemming from a meeting organised in July 2018 by Fern to discuss how the EU could regulate deforestation in supply chains. The meeting brought together experts in the field of trade, due diligence, land rights and deforestation.
Participants agreed that the EU should build on company commitments to halt deforestation and to strengthen these commitments by creating a soft law framework for deforestation-free commodity supply chains.