The European Parliament has recently voted against a proposal from the European Commission that would have categorised countries based on their risk levels related to deforestation under the EU Deforestation Regulation (EUDR). This categorisation plays a crucial role in the implementation of the regulation, which aims to reduce global deforestation caused by the EU’s supply chains. The decision marks a significant step in rethinking how the EU can address deforestation without imposing burdensome, bureaucratic measures on industries.
The vote, held on June 24, 2025, showed a clear opposition to the Commission’s proposed classification system, which would have divided countries into different risk categories regarding their involvement in deforestation. The European Parliament, in a move that reflects the growing unease over the EUDR’s implementation, called for the creation of a “zero-risk” category. Countries that pose no risk of contributing to deforestation, such as Austria, would benefit from more streamlined regulations.
Dr. Erlfried Taurer, the head of the Austrian Wood Industry Association, voiced strong opposition to the Commission’s proposal following the parliamentary vote. “This vote is a clear defeat for the European Commission. The Deforestation Regulation no longer holds political support within Parliament. I call on the Commission to respect the democratic vote of the elected members,” Taurer stated. He further emphasized that the Commission must recognize the reality of the situation, halt the EUDR’s implementation, and begin reducing bureaucratic hurdles.
Taurer pointed out that after over two years of intensive work, the Commission has yet to present a practical implementation model for the regulation. “The Commission should admit that its own regulation is unworkable. The EUDR should be included in future ‘Omnibus’ procedures for bureaucracy reduction, simplified significantly, or ideally, repealed altogether. This way, the European Commission can fulfill its promise of strengthening Europe’s competitiveness,” he added.
Alternatives for combating deforestation
The Austrian wood industry has expressed support for the overarching goal of the EUDR to halt global deforestation but advocates for a more balanced approach. Dr. Taurer proposed alternative measures to achieve this goal without overburdening the entire economy with excessive bureaucracy. One of his key proposals is the introduction of a “zero-risk” category for countries that pose no deforestation threat, such as Austria. For these countries, compliance with existing EU Timber Regulation (EUTR) documentation would suffice, eliminating the need for additional layers of complexity.
Furthermore, Taurer argued that risk-based controls would be a more effective and efficient way to target deforestation. “Deforestation does not occur in Europe, yet our businesses are expected to provide extensive documentation proving that their supply chains are free from deforestation risks,” he pointed out. He advocated for a shift from a general suspicion approach to one based on factual, risk-based assessments and targeted controls focusing on specific regions, products, or actors involved in deforestation.
Taurer emphasised that the European Union already has regulations in place to govern timber imports, and Europe’s forests are protected by stringent forestry laws and environmental regulations. He suggested that these existing frameworks, combined with risk-focused monitoring, could better address the deforestation issue without burdening businesses with overwhelming administrative requirements.
The burden of the EUDR
The EU Deforestation Regulation mandates that companies prove, at every stage of processing wood and wood products, that they are not linked to deforestation. This includes everything from raw material sourcing to the final product. The EUDR extends beyond imports to include manufacturing, trade, and export activities within the EU, creating a complex compliance landscape.
The regulation requires continuous proof from businesses, which leads to a considerable bureaucratic burden. In practice, this means that companies would need to manage and pass on thousands of reference numbers for every step of processing, every shipment, and every product. This data flood is neither verifiable nor practical to manage, leading to inefficiencies.
A study conducted in Finland has estimated that the introduction of such regulations could cost over 200 million euros in implementation alone, with annual operating costs reaching 65 million euros. When extrapolated across Europe, the total cost could balloon into billions of euros with little to no added benefit.
The economic impact on the wood industry
The Austrian wood industry, which is an integral part of the country’s economy, employs around 25,600 people and produces goods valued at 9.28 billion euros. The sector is key in the value chain for wood and forestry, influencing industries such as construction, furniture, and even ski manufacturing. In total, over 320,000 people are employed in Austria’s forestry and wood sectors, particularly in rural regions where the industry plays a crucial economic role.
As a result, any regulation that significantly increases operational costs or imposes additional administrative burdens has the potential to undermine the competitiveness of European industries, especially in sectors like wood processing, which depend heavily on efficient supply chains and minimal disruption.
The need for reform
Dr. Taurer’s call for reform echoes a broader sentiment within the industry: the EUDR needs to be simplified or abandoned. With the European Parliament’s recent vote against the proposed risk-based classification system, it is clear that many lawmakers are aligning with the industry’s perspective, calling for a less intrusive approach to tackling deforestation.
The alternative proposals – a zero-risk category for countries with no deforestation concerns and risk-based controls – could pave the way for a more balanced regulatory framework that supports the goal of halting deforestation without harming European industries.
In conclusion, while the European Union’s intention to combat deforestation is widely supported, the approach laid out in the EUDR has raised significant concerns in the wood industry. With Parliament’s recent decision, the industry now has an opportunity to push for more realistic, practical solutions that address deforestation while supporting the economic interests of European businesses. The future of the EUDR depends on finding a middle ground that balances environmental protection with economic viability.
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