Emerging international timber traderequirements and ITTO’s response
Thematic Workshop 3
CBFP MOP 20
3–5 June 2024, Kinshasa

Sheam Satkuru
Executive Director, ITTO

INTERNATIONAL TROPICAL TIMBER ORGANIZATION (ITTO)

The International Tropical Timber Organization’s
mission Promote the sustainable management andconservation of tropical forests.
 Promote the expansion and diversificationof trade in tropical wood from sustainably
managed and legally harvested forests.
The International Tropical Timber Organization(ITTO) is THE SOLE inter-governmentalorganization focused entirely on tropical forest
resources.
 76 members (37 producers & 39 consumers)covering 80% of global tropical forests andaccounting for 90% of trade in tropical forest
products!

Forest legality and sustainability
requirements
 A key requirement of sustainability―compliancewith all legal frameworks.
 Forest governance and legality requirements aremeant to reduce/eliminate illegal practices intropical forests.
 Greater need to demonstrate the legality andsustainability credentials of forest products.
 National and international legislations/regulations
require evidence of the legality of imported forest
products.
 Major markets for tropical timber and timber
products - strong signals to importers.
 More requirements are being faced by timber
producers.

Updates on major international timbertrade regulations and their requirements
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EU Timber Regulation/EU Deforestation
Regulation
CITES
US Lacey Act Amendments
Australia Illegal Logging Prohibition Act
UK Environment Act
Revised Japan Clean Wood Act
Korea
China
Viet Nam

EUTR
03.03.2013
EUTR enteredinto force

29.06.2023
EUDR enteredinto force

10 Years

EUDR
30.12.2027
EUDR fully
replaces EUTR

30.12.2024
EUDR needs to beappliedEUTR applies

EUTR and EUDR applyin parallel

18 Months

3 Years

EUDR applies

EUTR continues to apply in case of:Harvest before 29 Jun 2023
Placing on the EU market between 30 Dec 2024 and 30 Dec 2027

EUDR applies to all wood harvested from 29 Jun 2023
Source: ITTO-ETTF 2023

EU Deforestation Regulation (EUDR)EUDR entered into force on 29 June 2023:−



EUTR continues to apply if:−

From 30 Dec 2024 to 30 Dec 2027, EUTR and EUDR will exist inparallel.
harvest before 29 Jun 2023; placing on the EU market between 30 Dec
2024 until 30 Dec 2027.

EUDR applies to all wood harvested from 29 Jun 2023.
EUDR covers a wide range of timber products, including
sawn timber, wood-based materials, paper and furniture.
Exporters will need to provide EU importers with thefollowing information and documentation:−−−−−−

tree species,
country of harvest,
geo-coordinates of all plots of land where the timber was harvested,
date of time range of harvest,
evidence that the timber was legally harvested, andevidence that the timber is deforestation-free.

EUDR: Deforestation/forest degradation

EUTR applies

 Importers must prove that products don‘toriginate from a plot of land wheredeforestation or forest degradation
occurred after 31 Dec 2020.
 Deforestation: conversion of forest toagricultural land.
EUDR
applies of primary Forest Degradation:
conversion
forest or naturally regenerating forest toplantation.
 Possible evidence: Satellite images, official
documents, certification, own audits etc.
NOTE: No international consensus on the definition ofdeforestation and/or degradation

EUDR: importers and producers’ obligations
Importers:
 Apply a due diligence system (DDS) prior to placing on themarket:–

Aspects to be considered in DDS:
 Deforestation
 Forest degradation

Production (= harvest) according to local laws.
Submit due diligence statement to EU Information System.
Communicate information to customers.

Producers:
 Evidence that wood was harvested legally.
 Evidence that wood doesn’t originate from a plot of land where
deforestation or forest degradation occurred after 31 Dec 2020.
 For high-risk-economies (evidence of corruption or mixing alongsupply chains etc.), additional information and risk mitigation
measures might be necessary.

Source: ETTF 2023

EUDR: Information required from producers
 Geo-coordinates of all plots of land
where wood was harvested:− Area under four hectares: single point− From four hectares: polygon− In case of several plots of land: everything
must be specified!

 Date or time range of harvest
 Information about the product(scientific name etc.)
Source: ETTF 2023

EUDR: Legality requirements
Proof that wood was harvested according to local laws:
Land-use rights

Forest-related rules

Tax regulations

Labour rights

Environmental
protection

Trade and customs
regulations

Human rights

Anti-corruption
regulations

Third parties‘ rights

Indigenous peoples’
rights (includingFPIC)

Source: ETTF 2023

EUDR vs FLEGT/CITES
No exemption for woodcovered by FLEGT or CITES FLEGT = evidence of legality.
Deforestation and forest
degradation still need to bechecked.
 For CITES-wood, a complete
DDS must be applied.
 FLEGT/TLAS still goodstarting point!

EUDR: Consequences of non-complianceWithout geocoordinates, no due diligence statement
can be submitted
Customs will not allow import

Importers and their clients are responsible for thelegality of imports
 Companies can be sued by authorities

Through satellite imagery and EU Information
System, authorities can identify plausibility ofinformation

False information will cause serious problems forimporters:

High level of penalties (maximum amount: at least
4% of turnover).
Exclusion from public procurement, seizure ofproducts.
Public "blacklist" of companies who violate theregulation.

Source: ETTF, 2023

EUDR: Challenges
 The biggest challenge = collecting andsharing necessary proof that the wood islegal and deforestation-free.
 Insufficient information = no import intoEU possible.
 Many are ill prepared for this regulation,
but tropical forestry enterprises whichhave experience with EUTR and GIS
systems will have evidence/experience forcompliance.
Source: ETTF, 2023

CITES AppendicesSpecies subject to CITES regulations are included in
one of three Appendices:
Appendix I: Species threatened with extinction

Commercial trade
generallyprohibited

Appendix II: Species not necessarily threatened withextinction, but for which trade must be regulated toavoid their becoming threatenedCommercial tradepermitted andcontrolled

Appendix III: Species for which a country is asking
Parties to help with its protection

Commercial tradepermitted andmonitored
14

Source: CITES 2023

Tree species listed in the Appendices• In 1975, 18 tree species wereincluded in the Appendices.
• In 2022 at CoP19, 150 new tree
species were included inAppendix II.
• To date, +- 700 timber tree
species included in the CITES
Appendices.
• +97% listed in Appendix II.

Appendix I
1%Appendix III
1%Appendix II
98%

Appendix IAppendix II

Appendix III

Source: CITES 2023

Highlights of Appendix II listed tree species
New CoP19 listings of tree species!
Handroanthus spp. (Ipe)
Roseodendron spp. (Ipe)
Tabebuia spp. (Ipe)
Afzelia spp. Only African populations
Pterocarpus spp. Only African populations
Khaya spp. Only African populations
Other precious timber-producing species include:
Rosewoods (Dalbergia, 275 species)
Cedars (Cedrela, 17 species, populations of the Neotropics)
Ebonies (Diospyros, 85 species from Madagascar)
Bubinga (Guibourtia, 3 species)
African teak (Pericopsis elata)
Mahogany (Swietenia, 3 species)
Malagasy ebonies of the genus Diospyros spp. (around 85 species)
Medicinal and aromatic trees:
African cherry (Prunus africana)Agarwood producing trees (Aquilaria, Gonystylus and Gyrinops)
Source: CITES 2023

Enforcement related challenges (tree species)

17

Source from CITES: Share of type of wildlife
among total seizures (aggregated on the basisof standard value) 2005-2014

African rosewood trade suspension
recommendation
Article XIII (compliance): All 16 range States of Pterocarpus
erinaceus are currently subject to trade suspensions until NDFs andLAFs are developed to the satisfaction of the Secretariat and thePlants Committee.

Source: CITES 2023

Until then, no trade shall take placefrom:1) Cameroon
2) Central African Republic
3) Chad4) Gambia
5) Guinea-Bissau
6) Mali
7) Nigeria8) Togo9) Benin10) Burkina Faso
11) Ghana12) Sierra Leone
13) Cote d’Ivoire14) Guinea
15) Niger
16) Senegal

ITTO’s Response to forest law enforcement(FLE)
Rationalize
policy & legal
environment

Promotestakeholder
participation

ImprovedgovernanceImprove informationand knowledge base

Increase capacity toenforce rules andregulations

Rationalizing policy/legal environment
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Case studies on FLE (Forest Law
Enforcement)/illegal trade in many countries
found conflicting laws and/or incoherent
policies.
Projects in several countries have identified
underlying causes of illegality and drafted
coherent, consistent, enforceable forest
legislation.
Country diagnostic missions also identified
problems, promoted improved policies for FLE.
Programme to improve implementation ofCITES requirements for listed tropical timberspecies, ensure forest laws consistent withCITES.
ITTO has built capacity in the tropics, notable
examples include:––Forest and forest products statistics,Criteria and indicators.

Improving data and knowledge

Bi-monthly Tropical Timber Market Reportproviding prices, market and trade news.
Annual Review of the World Timber Situation
provides detailed information on trade flows.
ITTO Annual Market Discussions (held during
Council sessions).
Global Legal and Sustainable Timber Forum(GLSTF):––

2023 edition: November 2023, Macao SAR, China.
2024 edition: 11–12 September 2024
(www.itto.int/events).

Trade discrepancy studies and production/capacity comparisons; IMM project to monitor
FLEGT-licensed timber entering EU.
Timber tracking projects funded in manymember countries.
Several projects using satellite imagery with GIS(containing details of approved concessions,roads, etc.) to spot illegal forest clearing andtrack legal timber.

Improving data and knowledge

The Global Green Supply Chains (GGSC) platform
facilitates: www.itto-ggsc.org− Business information exchange and− Collaboration among timber producers, buyers,
processing industry and wood product market
representatives at national, regional and globallevels.
Global Timber Index and GTI wood-based panel
report (www.itto.int/gti): published monthly, tracks
the performance of the timber sector in 8 pilotcountries.
Blockchain-based Timber Traceability System (BTTS)(www.itto-ggsc.org/qkl/): identify new technologybased paths through the pilot collaborative
operation of the blockchain-based timber traceability
system to improve the transparency and authenticity
of timber traceability in the timber supply chain.

Improving data and knowledge
Long-standing work on market access, traceability, certification,
among others. Technical reports conducted on:
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The impact of timber procurement policies.
Uses and impacts of criteria and indicators for sustainable forest management.
Review of electronic and semi-electronic timber tracking technologies.
Assessment of major developments in technical and environmental standards
in selected major international timber markets.
Analysis of global trends impacting on the relative competitiveness of tropicalwood products.
The pros and cons of timber procurement policies.
Developing forest certification.
Many more …

Updates on issues related to tropical timber market access andcertification are presented at ITTC sessions.
www.itto.int/technical_report/

Promoting stakeholder involvement
 Civil society – Private sector partnershipgrants to contribute to SFM and verifiable
legality in many countries, some led toefforts to certify concessions.
 Private sector – an important forestry
stakeholder – taken steps to ensure thatthey exclude unsustainable and illegal
wood from their supply chains.
 Many companies recognize the increasingneed to understand and manage theenvironmental and social impacts
embedded in their operations, supplychains and investments = ESG, ESM, CSRetc.

ITTO Pilot Programme Lines
 Legal & Sustainable Supply Chains(LSSC)− Enhance tropical timber supply andvalue chains, from the forests to themarket, to achieve legality andsustainability.
− Capacities of legal and sustainablesupply chain enhanced, businesscollaboration and networking facilitated.

 Conservation of Biodiversity andEcosystem Services
 Forest Landscape Restoration andResilient Livelihoods
 Emerging Issues and Innovation

Increased capacity: ITTO’s long-standing
partner for SFM in Africa

Update of the ITTO/ATO Principles, Criteria andIndicators for the Sustainable Management ofAfrican Natural Tropical Forests.
Capacity building for sustainable managementof tropical rainforests and biodiversity
conservation in the ITTO Congo Basin countries TFU No. 29/1.
Promotion of sustainable management ofAfrican forests - TFU No. 25/4.
Development of intra-African trade and further
processing in tropical timber and timber
products - TFU No. 25/3.
Development and implementation of a species
identification and timber tracking system inAfrica with DNA fingerprints and stable isotopes- TFU No. 24/1.

Increased capacity: ITTO’s long-standing
partner for SFM in Africa


Development of training curricula for CentralAfrican countries on Legal and Sustainable supplyChains - TFU No. 31/2.
Established cooperation between the GGSC
Secretariat (China) and ITTO members in Africa.
DNA tracking technology piloted for African
cherry (a species listed in CITES Appendix II). A
new phase of the ITTO project commenced inMay 2021 to implement an effective DNA
traceability system to control trade - TFU No.
30/2.
Supported the 4th World Teak Conference held in
Ghana in September 2022 - TFU No. 31/3-4.
Empowering women in forest landscaperestoration (FRL) and agroforestry in Côte d’Ivoire(completed) and Togo (ongoing) - TFU No. 31/1.
Benin (about to start).
Promotion of smallholders’ FLR in West Africa.
More as described in the presentation.

Increase capacity: LSSC training modules for the Congo Basintransferable to other tropical regions

Aimed at: expanding market access for tropical timber
produced in the subregion and increasing the contributions of the sector tosustainable development, climate-change
mitigation and other regional objectives.
Four modules:
1) Understanding “zero deforestation”
2) Assessing legality and achieving accountability
3) From legality to sustainability4) Markets and market access.
Cover best practices in legality, sustainability andtraceability (as required by international markets).
Designed for use by a wide range of stakeholders.

www.itto.int/resources/?resType=learning-materials

Concluding remarks
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Forest governance involves multi stakeholders tonegotiate, agree and enforce binding decisions on themanagement, use and conservation of forest resources.
Forest governance—fast track to sustain tropicalforest—strengthened environmental protection, social
welfare and economic gain.
Major markets for tropical timber and timber products- strong signals for enforcement of timber legality andsustainability.
Increase in emerging trade regulations andrequirements are being faced by producers and now
also consumers (EUDR).
Developments on EUDR and CITES may have impact ontimber trade of Africa/Congo Basin.
Capacity building is urgently needed for timber
producers particularly Africa/Congo Basin.
ITTO – can play key role - THE main hub for assistingproducing member countries.

 Urgent need for fiscal/non-fiscal
incentives to motivate stakeholders!

WORK WITH US!
GLSTF: 11–12 Sept 2024,
Macao SAR, China
ITTC60: 1–6 Dec 2024,
Yokohama, Japan!
www.itto.int
satkuru@itto.int