Updating members of countries becoming at risk: Ukraine
Updating members of countries becoming at risk: Ukraine
ARTICLE · UPDATED ON 27 MAY 2021
On December 9, 2020, the EU Commission issued a joint-enforcement position on Ukraine with the following conclusion: Conclusions of the Competent Authorities for the implementation of the European Timber Regulation (EUTR) on the application of Articles 4(2) and 6 of the EUTR to timber imports from Ukraine stating that Sourcing timber and wood-based products from Ukraine is connected with high risk of sourcing products being in breach with applicable legislation in the country.
The final conclusions states:
- Sourcing timber and wood-based products from Ukraine is connected with high risk of sourcing products being in breach of applicable legislation in the country.
- Neither official documents including certificates of origin nor electronic timber tracking system relying on them will alone be sufficient to minimise risk of sourcing timber in contravention of the applicable legislation in Ukraine. Nor may FSC or other private third party verification schemes stand alone as risk mitigation measures to be able to reach negligible risk.
- All actual risks need to be identified and addressed adequately to mitigate the risk of illegality to a negligible level.
The report listed 13 risk areas that need to be taken into account during due diligence and a list of recommended mitigation measures, read full report here [LINK]
Summary of recommended mitigation measures
- Is there ongoing court cases against officials of SFEs (or other forest enterprises) at regional or national level, or if such suppliers or their officials were convicted of illegal logging or corruption during the last three years? Imports from such SFEs and regions should be suspended until the case is settled and/or until the operator has determined that the case does not constitute a non-negligible risk.
- Is the document authentic? Check the authenticity of the logging tickets, waybill, and other state controls at https://www.ukrforest.com/ and https://inspections.gov.ua/
- Is the information on documents (e.g. felling tickets, waybill or consignment notes, certificates of origin) correspond to the product?
- Is the product type or quality corresponding to the harvesting type and method, volume and quality, log assortments described in the documents? These should be considered red flags when, e.g. commercially valuable timber comes from forests with restrictions on commercial logging, good quality timber is derived from technological firewood, or the ‘useful outcome’ (calculation when logs converted into sawn timber) is an obvious theoretical calculation ‘on paper’, not a believable outcome which can be produced from the logs. Such information can be acquired from documents like.
- Can the logging areas be found on the SFRAU webpage https://www.ukrforest.com/check ?
- Is the timber originating from protected sites? Is there overlap between protected sites and harvesting areas? Is the logging documents reference to the logging areas, and that longitude and latitude of the logging areas correspond with satellite images of woodland leaving no doubt that no logging has occurred outside the legally gazette boundaries. Check the logging areas from satellite images – do they back-up the information given on official logging and transport documents?
- Are there any information suggestive of possible illegality, wrongdoing, court cases or corruption on Ukrainian press articles, court records, and other sources?
- Is the timber from sanitary logging? What is the type of cutting indicated on the waybills? What is the total volume of wood obtained from sanitary cutting? Avoid timber from sanitary logging to be mixed into your lot if the end use is not for firewood. Proper documentation of sanitary logging is almost impossible. Therefore it is recommended to use different types of available information to verify the need and justification of sanitary logging e.g. photo documentation of the area before and after harvest, use of local NGOs to verify a plausible need for preventive measures including sanitary logging. Without some kind of independent documentation of the need for sanitary logging there is a high risk of sourcing illegally harvested timber with fraudulent documents, regardless of the timber species concerned. Specific attention should be paid to high-value timber species originating from sanitary logging for which widespread calamities are not reported.
- Independent or self-conducted audits where a minimum of all risks from the above listed topics in this Annex are included and carried out in line with the Guidance Document on Risk Mitigation including field visits and interviews with suppliers, civil society and/or (local) NGOs carried out in line with the Guidance Document on Risk Mitigation. Furthermore, in regions where access to the forest is reported to be made impossible by the (concession) owners or due to violent crime, independent verification on the ground cannot be guaranteed by any verification body.
- Analysis of timber species and/or origin, if information provided is doubtful.
- Consideration to whom and where payments for the timber products are sent and for which services are being paid for. To reduce the risk of tax evasion ensure that contracts with SFEs for sale of timber are directly with the SFE itself or is made directly into the official bank account in Ukraine. If payment is not transferred to a Ukrainian account then check for what reasons this is not the case.
- PreferredByNarure Ukraine risk assessment https://preferredbynature.org/sites/default/files/projects/Operator%20workshop%20slides/PPT%20-%20Looking%20at%20risk%20in%20Ukraine.pdf
- EU Competent Authority’s perspective on due diligence for Ukraine and Russia https://preferredbynature.org/sites/default/files/projects/Operator%20workshop%20slides/Presentation%20Danish%20CA_EUTR.pdf
Latest media reports on illegal logging and associated trade in Ukraine (involving FSC and IKEA):
TTF would like to remind members to be aware of these risks and avoid importing from Ukraine unless robust mitigation measures have been proved to be in place and all identified risks are addressed successfully
Risk of unknown mixing with timber originated from Ukraine, where applicable, should also be examined to ensure such risks remain low.
Any questions or to discuss Due Diligence options on Ukraine, please contact TTF at email@example.com