On 21st March, the first day of spring, we celebrate the International Day of Forests. This is an important occasion to be reminded of the role that forests play on our planet. Forests are unique ecosystems that help preserve natural biodiversity while acting at the same time as carbon sinks. However, over the last decades forest loss and degradation have progressed at unprecedented rates, mainly because of human- induced activities. In this context, agricultural practices such as rearing of livestock and crop cultivation are often singled out as one of the main culprits of forest conversion into commercially exploited land.
Concerned by the negative environmental consequences of forest loss and degradation in terms of biodiversity preservation and climate change, some countries that are large consumers of products associated with deforestation passed – or are considering introducing – legislative measures to halt it. This is the case of the European Union (EU), which is the very first jurisdiction in the world that laid down an ad hoc legal framework addressing deforestation driven by agricultural expansion.
Regulation (EU) 2023/1115 – also known as EUDR (i.e., EU Deforestation Regulation) – represents the reference legal text on the subject matter. The latter provides for a complex set of mandatory due diligence requirements for producers and traders of specific commodities and derived products that are mostly associated with deforestation. Currently, the EUDR targets largely traded food and feed products such as meat, coffee, cocoa (including chocolate), soy, palm oil as well as other common goods such as wood and rubber.
Businesses affected by the EUDR requirements are currently working to implement their due diligence systems by the end of the year when the regulation becomes applicable. Such systems are meant to guarantee that no product contributing to deforestation is placed on the EU market or exported from the EU to other countries.
Overall, the implementation process of the EUDR has been quite complex for concerned companies, warranting the adoption by the European Commission of an extensive guidance document in the form of Frequently Asked Questions. Likewise, various trading partners of the EU have repeatedly raised concerns over EUDR impact on international trade during its negotiations and even more now that the EU should classify them based on the deforestation risk they present.
Yet, even though the EUDR is often portrayed as an instrument through which sustainable consumption practices can be promoted, consumers deserve little or no attention in the current text of the regulation. If one searches for the word ‘consumers’ within the EUDR, it will be immediately evident that such references are scant, marginal (as they mostly feature in the recitals of the regulation), and never employed by the EU legislator to ensure the high level of consumer protection pursued by the EU Treaties.
Against this background, one might wonder whether, ultimately, the EUDR will have any implications for European consumers.
In my view, this question should be responded affirmatively although a distinction needs to be made between economic and legal implications.
EUDR economic implications for consumers are obvious. Most likely, the costs of the investments needed to set up and operate the due diligence systems required by the EUDR will be eventually passed onto consumers. Besides, the EUDR may also have the (unintended) effect of restricting consumer choice in case, faced with difficulties in ensuring the sourcing of deforestation-free products, companies decide to suspend or even stop supplies.
Conversely, EUDR legal implications for consumers are less obvious. This is because they become apparent only if one considers the interplay of EUDR provisions with other EU legal acts. The joint reading of the EUDR alongside Regulation (EU) No 1169/2011 on the provision of food information to consumers and Directive 2005/29/EC, which regulates unfair commercial practices in a B2C context (‘UCPD’), represents one of the most interesting examples to showcase this.
Indeed, companies that are subject to the EUDR and comply with its requirements, at some point, might wish to capitalize the investments made in due diligence and communicate their efforts to consumers. Therefore, the question that here arises is whether a claim like ‘deforestation-free’ or with a similar meaning (e.g., ‘no deforestation’, ’zero deforestation’, etc.) can be made on EUDR-compliant products to appeal to the most environmentally conscious consumers.
In principle, for food products like coffee, cocoa, meat, and palm oil, Regulation (EU) No 1169/2011 already provides an answer to that question by setting out that ‘food information shall not be misleading, particularly […] by suggesting that the food possesses special characteristics when in fact all similar foods possess such characteristics […]’ (Article 7, par. 1, lett. c)). In other words, since all food products targeted by the EUDR will have to comply with its requirements when placed on the EU market with no exceptions, all of them will be deforestation-free. Therefore, no company will be able to communicate, in a B2C context, that it complies with EUDR requirements as a distinctive feature of its products, as opposed to the products sold by its competitors, because, otherwise, such information might mislead consumers.
For goods other than food products, a similar principle has been recently introduced within the UCPD regime through the adoption of Directive (EU) 2024/825. The latter, together with the European Commission’s Proposal for a Green Claims Directive, constitutes a key legal instrument to strengthen consumers protection against greenwashing in the EU. More precisely, the latest UCPD amendment has broadened the list of B2C marketing practices that are prohibited in all circumstances by including the situation in which a trader presents ‘requirements imposed by law on all products within the relevant category as a distinctive feature of its offer’. Owing to the mandatory nature of EUDR requirements for all the commodities and derived products identified by the regulation, this provision significantly limits the possibility for businesses to make deforestation-free marketing claims.
Then, if such claims will not be allowed on commodities and products targeted by the EUDR, will companies have any chance to communicate their commitments and achievements in the fight against forest loss and degradation?
Once again, it is not the EUDR to give us the answer we look for, but the UCPD as amended by Directive (EU) 2024/825. The latter provides for an outright ban on the display of ‘sustainability labels’ on consumer goods, unless such labels are granted and regulated by public or private independent certification schemes, whereas the notion of ‘sustainability label’ encompasses labels, logos and other graphic forms that allude to the environmental and/or social characteristics of a product. Therefore, for what matters here, labels awarded by certification schemes that focus on the responsible forest management might well qualify as ‘sustainability labels’ under EU law. At present, such labels seem to be one of the few legitimate ways that companies have at their disposal to inform consumers about their corporate efforts in the fight against deforestation.
In conclusion, B2C communication has certainly not been given sufficient attention during the elaboration and the implementation of the EUDR. This is quite striking if one considers that, on the other hand, the regulation provides for the naming and shaming of companies infringing its requirements at EU level, which may cause them considerable reputational damages including among consumers. However, looking ahead, at some point the EU legislator should take stock of the experience gained with the application of the EUDR and consider if deforestation-related claims may warrant any specific regulation or guidance to ensure consumers are adequately protected and businesses operate on a level playing field in the EU market.