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January 14, 2022
2022-5058

European Commission proposes new set of measures to address deforestation, waste management and soil health

Executive summary

The European Commission (the Commission) introduced two new proposals near the end of 2021: the first addressed European Union (EU)-driven deforestation and the second, the innovation of sustainable waste management. The Commission also introduced a new strategy focused on making soils healthy for people, nature and climate. The proposals are intended to complement the “Fit for 55” package launched in July 2021 and continue the work toward the objectives of the European Green Deal with respect to the circular economy, protecting nature and raising environmental standards in the EU and the rest of the world.

Detailed discussion

New regulation to curb EU-driven deforestation and forest degradation

On 17 November 2021, the Commission announced a proposal to curb global deforestation and degradation. The proposed new rules would set mandatory due diligence procedures for companies to guarantee that the products consumed in the EU market do not contribute to global deforestation and forest degradation. The main motivation of the Commission to introduce this new regulation is to better steer agricultural expansion in non-EU countries, which is promoted by EU-demand of commodities like soy, beef, palm oil, wood, cocoa and coffee, and all of their derived products (relevant commodities).

The proposed Regulation would repeal Regulation (EU) No 995/2010 on obligations of operators who place timber and timber products on the market and Regulation (EC) No 2173/2005 on the establishment of FLEGT (Forest Law Enforcement, Governance and Trade) licensing scheme for imports of timber into the European Community, as the Commission has concluded that they only partially address deforestation.

The new rules would prohibit placing in the EU market relevant commodities and derived products that do not undergo a due diligence procedure that ensures that the risk of deforestation and forest degradation is negligible. The due diligence obligations will vary based on the country of origin as each country will be assigned a standard level of risk. This would require the collection of geographic information of all plots of land where the relevant commodities and products have been produced.

Revised regulation on waste shipments

Also on 17 November, the Commission announced a proposal on waste exports, notably a more efficient system for the circulation of waste as a resource and determined action against waste trafficking.

Waste exports to non-Organisation for Economic Co-operation and Development (OECD) countries will be restricted and only allowed under certain conditions (e.g., proved sustainable management capabilities), while exports to OECD countries will be closely monitored and suspended if evidence of environmental problems arises. Within the EU, the revised rules propose simplified procedures to facilitate waste to re-enter the circular economy with the aim to reduce EU’s dependence on primary raw materials. Waste shipments into the EU will still have to be accompanied by specific information, including description and quantities of the waste, type of recovery operation in relation to the shipped waste and details of the facilities recovering the waste.

Regarding waste trafficking, the revised rules improve efficiency and effectiveness of the enforcement regime. This includes the creation of an EU Waste Shipment Enforcement Group for the European Anti-Fraud Office OLAF to support transnational investigations, and stronger administrative penalties. In addition, the revised rules propose measures to achieve a more consistent application of EU Member States’ inspection plans and harmonized approach for inspections across the EU.

New EU Soil Strategy

The Strategy recognizes the importance of soil as the foundation of the food system, major host of biodiversity and carbon pool. Therefore, it sets a framework for the protection, restoration and sustainable use of soils and proposes a set of voluntary and legally binding measures. This strategy aims to increase the soil carbon in agricultural land, combat desertification, restore degraded land and soil, and ensure that by 2050, all soil ecosystems are in a healthy condition.

The EU Soil Strategy establishes ambitious medium-term objectives by 2030 and long-term objectives by 2050. In terms of legislation, a direct result of this Strategy will be the upcoming Nature Restoration Law and the Soil Health Law by 2023, which will address transboundary impacts of soil degradation, secure equal market conditions, promote policy coherence at the EU and national level and thus be able to achieve the goals on climate change, biodiversity, food security and water protection.

The EU Soil Strategy is closely linked to other major strategies that are part of the European Green Deal, such as the Zero Pollution Action Plan, Circular Economy Action Plan, Chemicals Strategy, “Fit for 55” package, and Biodiversity Strategy for 2030, among others.

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For additional information with respect to this Alert, please contact the following:

Fit for 55

  • Alenka Turnsek, London | alenka.turnsek@uk.ey.com
  • Ana Fallas Conejo, Amsterdam | ana.fallas.conejo@nl.ey.com
  • Maike Moore, Berlin | maike.moore@de.ey.com
 
 

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