EUDR FAQ: What Businesses Must Know About the EU Deforestation Regulation

The EU Deforestation Regulation (EUDR) is a groundbreaking legal framework designed to fight global deforestation through supply chain transparency. As of 2025, companies that import or export key commodities like coffee, cocoa, soy, or wood to or from the EU must prove that their goods are deforestation-free, legally produced, and fully traceable.

This regulation affects operators, traders, and global supply chain professionals across multiple industries. Whether you’re a procurement manager, compliance officer, or sustainability lead, understanding how the EUDR works is crucial for maintaining EU market access and avoiding regulatory penalties. This article answers the most important questions about EUDR: what it is, how it works, what it requires, and how to prepare for it.

What Is EUDR and Why Was It Introduced?

The EUDR (European Union Deforestation Regulation) was created to address the EU’s role in global deforestation and forest degradation. It prohibits placing certain commodities on the EU market or exporting them unless they are proven to be deforestation-free, legally produced, and covered by a due diligence statement (DDS).

What does EUDR stand for and what is its goal?

EUDR stands for European Union Deforestation Regulation. Its primary goal is to ensure that products entering or leaving the EU market do not contribute to deforestation or illegal land use. The regulation applies to a specific set of commodities known to drive deforestation, such as soy, palm oil, wood, and cattle products.

The EUDR introduces legally binding obligations for companies and shifts the burden of proof onto businesses to demonstrate environmental compliance. It marks a clear departure from voluntary certification schemes by requiring traceable, verifiable evidence that sourcing activities are sustainable.

Why was it introduced and how does it fit into EU sustainability goals?

The regulation was introduced because the EU is responsible for approximately 10% of global deforestation, largely through imports of agricultural commodities. The environmental impact of this consumption includes biodiversity loss, increased greenhouse gas emissions, and land-use conflicts.

The EUDR is part of the EU’s wider Green Deal, which aims to make the EU climate-neutral by 2050. It also supports frameworks like the Corporate Sustainability Reporting Directive (CSRD) and the Corporate Sustainability Due Diligence Directive (CSDDD). Together, these initiatives seek to align business practices with environmental and human rights standards, ensuring that economic growth does not come at the cost of ecosystems or communities.

By enforcing deforestation-free trade, the EUDR positions the EU as a global leader in responsible sourcing and environmental accountability.

Who Is Affected by the EUDR?

The EUDR applies to a broad range of businesses involved in placing, exporting, or trading regulated commodities within the European Union. Understanding who is affected is essential for determining legal obligations and preparing the necessary compliance systems.

Which businesses must comply with EUDR?

The regulation distinguishes between two main categories of economic actors: operators and traders.

• Operators are companies that first place regulated products on the EU market or export them from the EU. This includes manufacturers, importers, and producers. Operators are fully responsible for performing due diligence, collecting geolocation data, assessing deforestation risk, and submitting a Due Diligence Statement (DDS) to the EU Information System.
• Traders are entities that make regulated products available on the EU market but do not place them there initially. This includes wholesalers, retailers, and distributors. While traders do not submit DDSs, they must be able to demonstrate that the goods they handle are compliant by referencing the operator’s DDS and storing related information.

The regulation applies regardless of company location. Even non-EU companies are indirectly affected if they supply goods that are placed on or exported from the EU market. In such cases, these suppliers must provide all necessary documentation to help EU-based operators fulfill their due diligence obligations.

Businesses operating globally with supply chains that include soy, palm oil, coffee, cocoa, rubber, wood, or cattle products must carefully determine their role in the chain and the related responsibilities.

Does EUDR apply to small or micro enterprises?

Yes, EUDR applies to small and micro-enterprises, although the regulation provides them with extended deadlines and reduced obligations in some cases.

• Small and micro operators must conduct full due diligence just like larger companies, including submission of DDSs and documentation of compliance. However, they are granted more time, with the enforcement deadline set at 30.06.2026.
• Small and micro traders are not required to conduct due diligence or submit DDSs. Their responsibility is to ensure that the goods they distribute originate from compliant operators. They must retain relevant documentation that references the operator’s DDS and cooperate with regulatory audits when requested.

Despite the adjusted timeline, small businesses are not exempt from the core requirements of EUDR. They are still legally bound to comply, and failure to do so may result in penalties, loss of market access, or reputational damage.

Companies of all sizes are advised to start preparing well in advance of their respective deadlines. Establishing internal compliance systems, engaging suppliers, and understanding legal obligations are essential steps for smooth and timely compliance.

What Products Are Covered by the Regulation?

Understanding which products fall under the scope of the EUDR is critical for determining whether your company is subject to the regulation. EUDR targets specific commodities and a broad range of goods derived from them, many of which are embedded deep within supply chains.

Which commodities fall under EUDR scope?

The EUDR applies to seven high-risk commodities that are directly linked to deforestation and forest degradation through their production and global trade. These are:

• Cattle: including live animals, fresh and frozen beef, leather, hides, and bovine offal.
• Cocoa: including beans, shells, paste, butter, powder, and chocolate products.
• Coffee: including green coffee beans, roasted coffee, husks, skins, and extracts.
• Palm Oil: including crude and refined oil, palm kernel oil, and derivatives used in food, cosmetics, and biofuel.
• Soy: including soybeans, oil, flour, meal, and soy-based animal feed.
• Wood: including logs, lumber, wood chips, pulp, paper, wooden furniture, prefabricated buildings, and wood-based panels.
• Rubber: including raw rubber and finished products like tires, hoses, conveyor belts, and footwear.

The regulation also covers products that are made using these commodities, even if the commodity is not present in the final product in a visible or raw form. For example, a leather handbag, a chocolate bar, or a printed book may be regulated under EUDR if they contain or are produced using listed commodities.

All covered products are identified using EU customs codes (CN/HS codes) specified in Annex I of the regulation. Companies must review these codes to confirm whether their goods fall within the regulated scope.

Are there any exemptions or special cases?

Yes, EUDR includes several clarifications and exclusions designed to avoid overreach and to focus enforcement on high-impact goods:

• Recycled products are generally excluded, unless they have been supplemented with newly added regulated materials during reuse, repair, or processing.
• Packaging materials are excluded unless they are themselves made of a regulated commodity and listed in Annex I. For instance, packaging made of paper or wood may still be covered if the relevant code applies.
• “ex” CN codes indicate partial coverage. For products marked with “ex,” only the specified segment of that product category falls under the regulation. Companies must assess applicability based on the exact product use and content.
• Timber harvested before 29 June 2023 and placed on the market before 30 December 2025 is temporarily exempt from EUDR requirements.

It is also important to note that the list of regulated products is subject to future updates. The European Commission may add new commodities based on deforestation trends and scientific data. Companies should monitor official publications and be prepared to adjust their compliance programs accordingly.

In conclusion, if your product contains, consists of, or was produced using any of the seven regulated commodities, it likely falls under EUDR. Careful review of product composition and customs classification is essential for determining compliance obligations.

What Does EUDR Compliance Involve?

Compliance with the EU Deforestation Regulation (EUDR) is not a single declaration, it’s an integrated process that ensures every product placed on or exported from the EU market meets strict environmental and legal criteria. Understanding these requirements is essential for building internal systems and avoiding regulatory risks.

What are the three main compliance conditions?

To legally place a product on the EU market under the EUDR, companies must meet three fundamental compliance conditions:

• Deforestation-free production: The product must be derived from commodities that were not produced on land subject to deforestation or forest degradation after 31 December 2020. This requirement applies regardless of whether the deforestation was legal under local laws. The definition of “deforestation-free” includes the maintenance of natural forests and excludes land that was converted into plantations or agricultural fields after the cut-off date.
• Legal compliance in the country of origin: Products must be produced in accordance with all relevant laws of the country where the commodities were harvested or extracted. This includes laws on land use rights, forest management, labor rights, human rights, tax, and environmental protection. The EUDR introduces a broader legal responsibility than traditional customs or trade requirements.
• Submission of a Due Diligence Statement (DDS): Before any regulated product can be placed on the EU market or exported, the company must submit a formal DDS through the EU’s centralized platform, confirming compliance with deforestation and legality requirements. No DDS = no market access.

These conditions must be met before a product enters the EU market. Non-compliance with any one condition is sufficient grounds for enforcement action, including seizure, fines, or bans.

What is a Due Diligence Statement (DDS)?

The Due Diligence Statement (DDS) is a legally binding declaration that the product complies with all EUDR requirements. It is the final output of the company’s internal due diligence process and is submitted via the EU Information System, known as TRACES (Trade Control and Expert System).

The DDS must include the following elements:

• A clear description of the product and its volume.
• Country of production and product type.
• Geolocation coordinates of all production plots or farms.
• The date or timeframe of production or harvesting.
• Legal documentation from the country of origin (e.g., land titles, permits).
• Results of the risk assessment, with justification for the assigned risk level.
• Description of any risk mitigation measures taken, if applicable.
• A signed declaration of compliance from the responsible operator.

Each DDS is tied to a specific shipment or batch and must be submitted before the product is released for free circulation in the EU or exported. The platform assigns a unique reference number, which can be used by traders and authorities for tracking and verification.

Operators must store all supporting documents related to the DDS for a minimum of five years. Failure to submit an accurate or complete DDS may result in immediate non-compliance, regardless of whether the product itself is legal or sustainably sourced.

Ultimately, the DDS serves as both a compliance gateway and legal accountability mechanism, holding companies responsible for the accuracy and reliability of their supply chain data.

What Is Due Diligence Under EUDR?

Due diligence under the EUDR is not a formality – it is a legally required, evidence-based process that companies must complete before placing any regulated product on the EU market or exporting it from the EU. It ensures that goods are both deforestation-free and legally produced. Without completing this process properly, companies cannot submit a Due Diligence Statement (DDS), and their products will be blocked from the EU market.

What are the three steps of due diligence?

To comply with EUDR, operators must follow a three-step due diligence procedure, each of which builds on the previous one:

1. Information gathering

This is the foundation of the entire process. Companies must collect detailed and verifiable information that allows them to trace the commodity back to its origin. Required information includes:

• Description and quantity of the product.
• Country of production.
• Geolocation coordinates for all plots of land used to grow or extract the commodity.
• Date or range of harvesting or production.
• Name and contact details of suppliers and producers.
• Legal documents proving compliance with national laws (land tenure, labor rights, tax, environmental protection, etc.).

This data must be accurate and complete. Companies often need to work directly with suppliers, producers, and cooperatives to ensure consistency across the supply chain.

2. Risk assessment

Once data has been gathered, companies must assess the risk that the product is not deforestation-free or not legally produced. This includes:

• Reviewing whether the land was forested after 31 December 2020.
• Verifying the legality of land use and production.
• Considering the risk level of the producing country or region (based on public lists, NGO reports, corruption indices, etc.).
• Assessing traceability, documentation quality, and supplier history.

Risk assessments must be well documented, and each product or shipment must be assessed individually unless part of an approved simplified procedure (available in low-risk cases).

3. Risk mitigation

If there is any non-negligible risk, companies must take proportionate and effective measures to reduce that risk to “negligible” before the product is placed on the market. Risk mitigation actions may include:

• Requesting additional documentation.
• Conducting supplier audits or field inspections.
• Engaging third-party verification or certification.
• Changing suppliers or modifying sourcing practices.

Only when the risk has been reduced to a negligible level can a company proceed to submit the DDS.

What documentation is required?

EUDR due diligence requires maintaining extensive documentation as legal proof of compliance. Required documents include:

• GPS coordinates of the production plots (single-point for small farms, polygon for large areas).
• Harvest or production dates, aligned with geolocation data.
• Official permits and certificates from the country of origin.
• Contracts or declarations from suppliers.
• Risk assessment reports, including data sources and rationale.
• Records of risk mitigation actions, if applicable.

All documentation must be stored for a minimum of five years and made available upon request by the competent authorities of any EU Member State. Failure to provide documentation during inspections may lead to legal penalties, even if the DDS was submitted on time.

Due diligence is a continuous obligation. If any condition in the supply chain changes such as a new supplier or updated land-use status the due diligence process must be repeated and the DDS updated accordingly.

How Does EUDR Monitoring Work?

Monitoring is a central pillar of EUDR compliance. It ensures that due diligence is not a one-time task, but a continuous process of data collection, verification, and risk management. Effective monitoring helps companies maintain accurate records, detect issues early, and respond to environmental or legal changes in real time. It also provides credible evidence to support due diligence statements during audits by EU authorities.

What is supply chain monitoring in EUDR terms?

Under the EUDR, monitoring refers to the ongoing observation and verification of sourcing practices to confirm that commodities are deforestation-free and legally produced. It goes beyond initial data collection and includes regular updates and validation throughout the supply chain.

Monitoring must:

• Cover the full lifecycle of the commodity, from production to EU market entry or export.
• Track and verify that land used for production has not been deforested or degraded after 31 December 2020.
• Identify and assess emerging risks in sourcing regions or among suppliers.
• Be fully documented and available for inspection by EU competent authorities.

Monitoring is essential to support the accuracy of the Due Diligence Statement (DDS) and ensure that data remains up-to-date. It also reinforces supply chain transparency, helping companies detect compliance gaps before they result in penalties or trade disruptions.

What are the four key components of EUDR monitoring?

To build a reliable monitoring system under EUDR, companies should focus on four essential components:

1. Geolocation data collection

Geolocation data is the core of traceability under the EUDR. It ties each product to a specific plot of land and allows for verification of forest cover status.

Companies must collect:

• GPS coordinates (latitude and longitude) for each production site.
• Polygon data for larger farms or plantations.
• Time-stamped data indicating when production or harvesting occurred.

This data can be gathered via GPS devices, mobile applications, or supplier declarations. Validation steps, such as comparing coordinates with satellite maps or public land registries, help ensure accuracy.

2. Remote sensing and satellite verification

Satellite imagery and remote sensing provide independent, visual evidence of whether deforestation has occurred. These technologies help companies:

• Monitor land cover change over time.
• Detect forest clearing, degradation, or fire damage.
• Verify that production areas were forest-free after 31 December 2020.

Many platforms use high-resolution imagery and AI tools to classify forest types and flag anomalies. These alerts can be used to trigger supplier investigations or to support ongoing risk assessment.

3. GIS-based risk mapping

Geographic Information Systems (GIS) help companies visualize and manage risk spatially. GIS tools allow integration of multiple data layers, including:

• Supplier locations.
• Historical deforestation data.
• Protected areas and biodiversity hotspots.
• Indigenous or disputed land zones.

GIS mapping supports strategic decision-making and helps compliance teams prioritize high-risk regions for further scrutiny or mitigation.

4. Dynamic risk assessment with updates

EUDR monitoring is not static. Companies must continually assess and update risks as new data becomes available or supply chains evolve. This includes:

• Reassessing suppliers when their location, practices, or documentation changes.
• Updating risk scores when satellite data indicates new deforestation activity.
• Adjusting due diligence procedures if a region becomes classified as “high risk.”

This dynamic approach ensures that due diligence remains responsive and defensible in the face of regulatory inspections or market changes.

Together, these four components create a monitoring framework that supports ongoing EUDR compliance and prepares businesses for audit-readiness and market continuity.

Which Tools and Technologies Support Compliance?

As EUDR compliance requires precise, continuous monitoring and documentation, many businesses are turning to digital tools to manage complex supply chains. These technologies not only automate time-consuming tasks but also improve the accuracy and reliability of due diligence processes. By integrating digital systems into operations, companies can ensure full traceability, reduce risk, and prepare for EU audits with confidence.

What digital platforms help with EUDR compliance?

A variety of digital platforms have emerged to support businesses in meeting EUDR requirements. These systems combine geospatial analytics, data management, and automation to streamline due diligence and monitoring.

Key platform types include:

• Satellite imagery analysis tools: These platforms detect deforestation events, classify forest cover, and generate alerts based on real-time land use changes. They are essential for verifying that production plots were not deforested after 31 December 2020.
• GIS dashboards: Geographic Information System dashboards visualize supply chain data, showing supplier locations, deforestation risks, and legal boundaries. They help identify high-risk zones and manage compliance actions spatially.
• Traceability platforms: These tools allow companies to track products and ingredients from origin to market. They store supplier data, batch information, and geolocation coordinates, providing a digital audit trail for every shipment.
• Due diligence compliance systems: These platforms help companies collect and organize all documentation needed to generate and submit a Due Diligence Statement (DDS). They often include modules for risk scoring, documentation uploads, and decision logs.

Leading platforms in this space often combine several of these functions into a single interface, making it easier for compliance teams to maintain oversight across multiple suppliers, regions, and product lines.

How can companies integrate these into operations?

Technology tools only deliver real value when they are embedded into everyday business processes. Successful EUDR compliance requires full integration of digital monitoring systems with internal workflows and enterprise software.

Recommended integration strategies include:

• ERP integration: Enterprise Resource Planning (ERP) systems contain product, order, and supplier data. By linking EUDR platforms with ERP systems, companies can automate the generation of DDS forms and ensure data consistency across business units.
• SCM alert systems: Supply Chain Management (SCM) platforms can trigger alerts if a supplier enters a high-risk zone or fails to submit required documents. This helps teams act quickly to mitigate risks or suspend non-compliant shipments.
• Data syncing and automation: Regular synchronization of data between internal systems and compliance platforms ensures that due diligence statements reflect the most current supplier information and land status. Automation reduces the risk of human error or missing documentation.
• Custom dashboards for teams: Dashboards tailored to different departments (procurement, sustainability, compliance) enable cross-functional collaboration. Each team can access relevant compliance data in real time without duplicating efforts.

By integrating digital tools at every stage from sourcing and risk assessment to documentation and reporting companies build a streamlined, auditable EUDR compliance ecosystem that scales with their operations.

What Are the Enforcement Mechanisms and Penalties?

Enforcement is a critical component of the EUDR framework. The regulation is backed by a structured system of monitoring, inspections, and penalties designed to ensure that businesses take compliance seriously. Companies that fail to meet the requirements may face not only financial consequences but also reputational and operational risks. Understanding how enforcement works under EUDR helps businesses assess their exposure and take proactive steps to stay compliant.

What happens if a company does not comply?

Non-compliance with the EUDR can trigger a range of legal and commercial consequences. These penalties are intended to be “effective, proportionate, and dissuasive,” in line with EU law.

Potential consequences include:

• Fines of up to 4% of the company’s total turnover in the EU.
• Seizure or destruction of non-compliant goods by customs or competent authorities.
• Temporary bans on placing products on the EU market or exporting from the EU.
• Exclusion from public procurement or access to EU funding programs for up to 12 months.
• Suspension from simplified import procedures, such as customs fast-track systems.

Beyond legal sanctions, companies may also suffer indirect consequences such as:

• Loss of contracts with EU buyers requiring EUDR compliance.
• Reputational damage with investors, customers, and NGOs.
• Disruptions in logistics and supply continuity.

To avoid these outcomes, companies must invest in due diligence, documentation, and traceability systems that fully align with EUDR requirements.

How will authorities check for compliance?

Each EU Member State is responsible for designating competent authorities to enforce the EUDR within its territory. These authorities will conduct inspections, investigate risks, and apply penalties where necessary. Inspections may be triggered randomly, through risk analysis, or following third-party alerts.

Enforcement activities include:

• Review of Due Diligence Statements submitted through the EU TRACES system.
• On-site inspections at the premises of operators and traders.
• Document audits, including supplier contracts, geolocation data, and risk assessments.
• Satellite data analysis to cross-check declared production plots against deforestation alerts.
• Product sampling or physical testing, including species identification for wood products.

Authorities may also collaborate with customs agencies, NGOs, and international verification bodies to detect inconsistencies or high-risk shipments. The goal is to apply a risk-based inspection approach, focusing enforcement efforts where the likelihood of non-compliance is highest.

How long should companies retain compliance data?

Under EUDR Article 9, companies are required to retain all relevant compliance documentation for at least five years. This obligation applies to both operators and traders and includes:

• Geolocation data and production plot maps.
• Supplier contracts and legal documents.
• Risk assessment records and mitigation actions.
• Submitted Due Diligence Statements and supporting evidence.
• Communications and decision logs related to compliance processes.

Maintaining this archive is essential for passing inspections, responding to audits, and demonstrating that a company acted in good faith and followed legal obligations.

What Are the Common Compliance Challenges?

Despite the clear structure of the EUDR, many companies face practical difficulties in meeting its requirements, especially those operating across complex, global supply chains. Challenges range from data availability to supplier engagement and technological readiness. Recognizing these obstacles early enables businesses to develop realistic compliance strategies and avoid delays or penalties.

What difficulties do businesses face?

Several common barriers can complicate EUDR compliance, particularly for SMEs and companies sourcing from high-risk or low-infrastructure regions.

• Data collection from smallholders: Many commodities regulated under the EUDR, such as cocoa, coffee, and rubber, are produced by smallholder farmers. These producers often lack digital tools, formal land titles, or experience with traceability systems, making it hard to obtain reliable geolocation and legal documentation.
• Limited digital infrastructure: In parts of Southeast Asia, Latin America, and sub-Saharan Africa, internet access, mobile connectivity, and satellite coverage may be limited or inconsistent. This affects companies’ ability to gather, verify, and transmit data on time.
• High costs of compliance: For small and mid-sized enterprises, the financial burden of EUDR compliance can be substantial. Costs include investment in software, training, third-party audits, and monitoring subscriptions.
• Fragmented supply chains: Many companies do not have direct relationships with all actors in their supply chain. Products may pass through multiple intermediaries, increasing the risk of data loss or non-transparent practices.
• Lack of internal capacity: Some businesses lack dedicated compliance or sustainability teams to manage ongoing monitoring, documentation, and reporting under EUDR. Without specialized staff, these obligations can become overwhelming.
• Unclear land rights: In some sourcing regions, land tenure systems are informal or disputed. This creates legal uncertainty and complicates efforts to verify the legality of production plots.

How can companies overcome these barriers?

While the challenges are real, they are not insurmountable. Several proactive strategies can help companies meet EUDR requirements despite structural limitations.

• Supplier training programs: Educating producers and local partners on EUDR requirements builds awareness and improves data quality. Training can cover GPS use, land documentation, and digital reporting formats.
• Compliance toolkits and templates: Providing standardized forms, checklists, and guidance documents simplifies data collection across diverse supply networks. These resources help ensure consistency and reduce administrative errors.
• Third-party verification and partnerships: External consultants, NGOs, and local verification bodies can assist in data gathering, risk assessments, and monitoring. This is especially useful in high-risk or remote areas.
• Technical and financial support: Companies can apply for EU-supported initiatives or collaborate with industry groups that offer co-financing, open-source tools, or shared infrastructure to ease the burden on SMEs.
• Early preparation and phased roll-out: By starting compliance efforts well before the deadlines (30.12.2025 for large companies and 30.06.2026 for SMEs), businesses gain time to identify gaps, test systems, and refine their approach.

Adapting to the EUDR is complex, but investing in these measures not only ensures regulatory compliance it also builds more resilient and transparent supply chains.

How to Start Preparing for EUDR

With the EUDR enforcement deadlines approaching 30.12.2025 for large companies and 30.06.2026 for small and micro-enterprises businesses must begin laying the groundwork for compliance now. Early preparation is essential to avoid disruptions in EU trade, financial penalties, or reputational risk. This section outlines the key steps companies should take to build readiness across operations and supply networks.

What should companies do right now?

Preparation for EUDR is not a one-time task – it’s a structured, multi-step process that requires coordination across departments, systems, and suppliers. The following actions should be prioritized immediately:

• Map supply chains: Identify which commodities you source that fall under EUDR regulation and trace them back to their origin. This includes understanding whether the products contain, are derived from, or are fed with EUDR-covered commodities.
• Collect geolocation data: For each farm, plantation, or forest plot involved in the production of regulated commodities, collect precise GPS coordinates and plot boundaries. Time-stamped harvest or production data is also needed to prove the land was not deforested after 31.12.2020.
• Build internal compliance teams: Assign roles within procurement, legal, IT, and sustainability teams. Ensure that staff are trained on EUDR requirements and due diligence workflows. Appoint a responsible person or unit to oversee the due diligence process.
• Choose monitoring platforms: Select digital tools that can support supply chain mapping, satellite-based forest monitoring, risk scoring, and due diligence reporting. Evaluate whether integration with your ERP or SCM system is needed.
• Engage suppliers: Begin outreach to producers, traders, and cooperatives. Explain the EUDR requirements, request documentation, and offer support to improve traceability. Focus on building trust and cooperation across your supplier network.
• Develop documentation protocols: Create templates for geolocation records, risk assessments, supplier declarations, and due diligence statements. Organize storage and retrieval systems to ensure all records are retained for at least five years.

By following these steps, companies create a structured compliance foundation that can scale as their operations grow or the regulation evolves.

Is there a grace period or flexibility?

There is no formal grace period under the EUDR. Once the deadlines are reached 30.12.2025 for large enterprises and 30.06.2026 for SMEs companies must be fully compliant to legally place covered products on the EU market or export them from the EU.

However, the regulation follows a phased implementation timeline based on company size:

• Large enterprises must comply by 30 December 2025.
• Small and micro-enterprises have an additional six months, with a deadline of 30 June 2026.

While the timeline provides a transitional window, there is no flexibility in enforcement once the deadline passes. Member State authorities will begin inspections and audits immediately after the regulation enters into force for each group.

Therefore, businesses are encouraged to treat the current period as a build-up phase, a time to test systems, collect data, and refine risk assessments. Waiting until the last moment increases the risk of incomplete compliance, shipment delays, or penalties.

What Is the Future of EUDR?

The EU Deforestation Regulation (EUDR) is designed not as a fixed policy but as a dynamic regulatory framework that will evolve with time. Future updates are expected as the European Commission collects more data, assesses implementation outcomes, and aligns the EUDR with other sustainability regulations. Businesses should prepare for regulatory changes and a possible expansion of scope that will shape compliance expectations for years to come.

Will the regulation expand?

Yes, the EUDR is expected to expand in several key areas. While the initial regulation covers seven core commodities (cattle, cocoa, coffee, palm oil, soy, wood, and rubber), the European Commission has made it clear that future updates may include additional products and changes to risk classifications. The likely directions of expansion include:

Additional commodities under consideration

New products may be added based on their deforestation impact. Likely candidates include:

• Maize: Widely cultivated in deforestation-prone areas, especially in Latin America.
• Sugarcane: Linked to land-use change in tropical regions.
• Biofuels: Increasingly scrutinized for indirect land-use change effects.
• Viscose and textiles: Derived from forest-based cellulose, with growing concerns around unsustainable sourcing.

Risk classification updates

The European Commission will assign countries a deforestation risk level high, standard, or low based on deforestation records, governance quality, and environmental safeguards. These classifications will be reviewed regularly and directly affect how much due diligence is required for sourcing from those countries.

Broadening product coverage through Annex updates

Annex I of the regulation lists the specific HS/CN codes for covered products. Over time, the annex may be updated to include new subcategories, composite goods, or derivatives not originally listed.

Alignment with other EU sustainability frameworks

EUDR will likely be integrated with other EU initiatives, including the Corporate Sustainability Reporting Directive (CSRD), the Corporate Sustainability Due Diligence Directive (CSDDD), and the Green Claims Directive. This could lead to harmonized data requirements and shared compliance workflows.

TRACES system enhancements

The EU’s TRACES platform for submitting Due Diligence Statements is being upgraded to support the EUDR. Future features may include automated alerts, integration with customs systems, and links to deforestation monitoring tools. Companies using legacy IT systems may need to adapt their technical infrastructure to keep up.

These future developments suggest that EUDR is a living framework designed to evolve in response to environmental data, policy integration, and supply chain realities. Companies that invest in flexible, scalable compliance systems today will be better equipped to meet future demands.

Digital Solutions for Simplifying EUDR Compliance

EUDR.co is a purpose-built platform that helps businesses comply with the EU Deforestation Regulation (EUDR) through automation, traceability, and real-time risk management. Designed specifically to support EUDR workflows, the platform enables companies to collect geolocation data, assess deforestation risk, and generate Due Diligence Statements (DDS) in line with regulatory requirements.

By integrating satellite imagery, GIS tools, and secure digital documentation, eudr.co ensures supply chain transparency and audit-readiness. Its flexible architecture supports both smallholder sourcing and complex multi-tier supply chains, making it a scalable solution for companies seeking long-term, efficient EUDR compliance.

Conclusion

The EU Deforestation Regulation (EUDR) represents a major shift in how global businesses must manage environmental responsibility within their supply chains. By requiring full traceability, legal compliance, and proof of deforestation-free sourcing, the regulation raises the bar for transparency and due diligence in global trade. For professionals involved in procurement, compliance, or sustainability, EUDR is more than a legal obligation – it is a call to align corporate operations with international environmental goals.

Preparing for EUDR requires early action, strategic investment in monitoring technologies, and close collaboration with suppliers. Companies that begin building their compliance systems now will be better equipped to avoid penalties, maintain EU market access, and lead the way in ethical sourcing. As the regulation continues to evolve and expand, the ability to adapt and respond proactively will become a critical business advantage.