EU deforestation law delayed: Impact on your supply chain

The European Union has postponed the implementation of its landmark deforestation regulation (EUDR), which was set to curb imports of commodities linked to forest loss. While this delay offers temporary relief for businesses, it introduces fresh uncertainty around compliance timelines and increases reputational risk. Companies operating or trading within the EU must use this time to strengthen traceability and due diligence systems.

The EUDR aims to prohibit the sale of products in the EU that contribute to deforestation or forest degradation. Commodities affected include palm oil, soy, beef, cocoa, coffee, and timber, along with derived products like leather, chocolate, and furniture. Companies will be required to:

• Under the EUDR, products must be deforestation‑free relative to the cut‑off date of 31 December 2020 (i.e. no land clearance or degradation after that date). Even though enforcement is delayed, that threshold remains central to compliance law.
• Collect geolocation and supplier data.
• Submit due diligence statements to an EU-wide information system.

Learn more about the EUDR directly from the EU Commission.

Why the delay?

Technical system challenges

The EU’s digital infrastructure for collecting and managing due diligence data is not yet equipped to handle the scale and complexity of expected submissions.

Industry readiness gaps

Many businesses and producer countries lack the capacity to comply, especially smallholder-dominated supply chains. This could lead to market exclusion without adequate preparation.

Regulatory coordination needs

Additional time allows the EU to finalize enforcement guidelines and risk assessments for sourcing countries.

Risks for businesses

Even with the delay, risks are intensifying:

• Compliance Confusion: Shifting deadlines make it hard to plan.
• Reputational Damage: Sustainability claims may be challenged if firms are inactive.
• Operational Disruption: Suppliers unprepared for future audits may cause delays.
• Investor Pressure: ESG-focused stakeholders still expect progress.

Companies that take early action can build resilience and avoid costly future overhauls.

Global context: UK and Australia

UK Forest Risk Commodities Regulation (UKFRC)

The UK’s Environment Act will introduce similar requirements, though initially focused on illegal deforestation. It will also apply due diligence obligations to major importers.

Explore the UK’s proposed regulation and how it differs from EUDR.

Australia and beyond

Australia and other regions are evaluating similar laws. The EU’s leadership here may influence future frameworks globally. Companies with multinational footprints must prepare for multi-jurisdiction compliance.

What companies should do now

Despite the delay, companies should act now to future-proof their operations:

• Map Supply Chain Risk: Identify deforestation-linked commodities and sourcing regions.
• Invest in Traceability Tools: Platforms like eco-shaper can centralize data collection and risk scoring.
• Begin Due Diligence Pilots: Start testing supplier documentation and compliance checks.
• Engage Suppliers: Build capacity among producers, especially in high-risk geographies.
• Align Internally: Bring legal, procurement, and ESG teams together to define a compliance roadmap.

Stay ahead of the curve

The deferral of the EU deforestation law doesn’t remove your responsibilities, it sharpens them. Businesses that act decisively will strengthen supply chain resilience, meet stakeholder expectations, and be well-positioned for future regulation.

To learn how eco-shaper can support your deforestation-free compliance efforts, book a strategy call with our sustainability advisors.