At Yulex, we collaborate with partners from around the world to establish certified supply chains. We are committed to strict compliance with all laws and regulations in the production and sale of our products like YULEX® FOAM, as well as finished goods like wetsuits, footwear, fashion, and accessories made from YULEX® FOAM. We are proactive in staying informed about market changes, especially in relation to regulations that impact our natural rubber supply chains. An example of this is the recently enacted EU Deforestation Regulation (EUDR) in Europe, which came into effect in late June 2023.
In support of our EU customers who use our products, including YULEX® FOAM and the upcoming YULASTIC® FIBRE, we have created a comprehensive FAQ on the EUDR. This resource is designed to help you gain a clear understanding of the regulation and prepare for its implementation in 2024.
1. What is the purpose of EUDR?
The Deforestation Regulation is aimed at minimizing the EU’s contribution to deforestation and forest degradation worldwide to reduce the EU’s contribution to greenhouse gas emissions and global biodiversity loss.
2. What products must comply?
- 7 commodities that are the largest share of Eu-driven deforestation: palm oil, soya, wood, cocoa, coffee, cattle, and rubber
- No matter where they are produced (in or out of the EU)
3. What is a “relevant” natural rubber product under the regulation?
Harmonized System (or "HS" codes) codes are a standardized numerical method of classifying traded products. It is used by customs authorities around the world to identify products. The EUDR lists the following HS codes for natural rubber. Some HS codes have "ex" in front of the codes and it means “extract” and such extracted products are covered under the EUDR.
The below list may change from time to time by an authorized committee of the EUDR.
- 4001 Natural rubber, balata, gutta-percha, guayule, chicle, and similar natural gums, in primary forms or in plates, sheets or strip
- ex 4005 Compounded rubber, vulcanized, in primary forms or in plates, sheets or strip
- ex 4006 Un-vulcanized rubber in other forms (e.g., rods, tubes, and profile shapes) and articles (e.g., discs and rings)
- ex 4007 Vulcanized rubber thread and cord
- ex 4008 Plates, sheets, strips, rods, and profile shapes, of vulcanized rubber other than hard rubber
- ex 4010 Conveyer or transmission belts or belting, of vulcanized rubber
- ex 4011 New pneumatic tires of rubber
- ex 4012 Retreaded or used pneumatic tires of rubber; solid or cushion tires, tire treads and tire flaps, of rubber
4. What about Products or HS Codes not included above?
They are not subject to the requirements of the Regulation even if they may contain natural rubber that falls in the scope of the Regulation.
The EUDR has not provided more clarity on this.
5. Do I need to trace the relevant natural rubber product to a plot of land?
Yes, all relevant products need to be traced back to their plot of land and date or time range of production before making it available or placing it on the market, or before exporting it.
Yulex is developing our own TRACEability digital app that intends to provide Yulex customers and brands in the Vietnam and Thailand certified supply chain the required information for their due diligence statement.
For other certified Yulex supply chains, we will work with our partners in the region to obtain the required information.
6. Who is affected?
- EU Operators and Traders throughout the supply chain
- Operators who are in the course of a commercial activity, places natural rubber products on the EU market or exports them from the EU market
- Traders, other than the Operator, who make natural rubber available on the EU market
- It does not matter whether the Operator or Trader is residing or are established outside the EU
7. When does EUDR take effect?
- 30 December 2024 for Operators and Traders who are not SMEs (Small and medium-sized enterprises with less than 10 and no more than 250 employees with a balance sheet of less than 2M to and no more than 43M Euros)
- 30 June 2025 for Operators and Traders who are SMEs
8. what about the legality and social protection requirements in eudr?
- Rubber production and procurement must adhere to all applicable country legislations (e.g. Vietnam, Thailand etc.). Yulex develops PEFC and or FSC natural rubber supply chains, which are annually audited and already meet these EUDR legality requirements.
- Rubber production and procurement must adhere to certain social protections. Again, Yulex is known for only working with PEFC and/or FSC natural rubber supply chains since inception. Sustainable forestry certification under these 2 internationally recognized programs includes fair wages, safe working conditions, and upholding the rights of workers and Indigenous Peoples and follow all in-country labor and International Labor Organization (ILO) guidance,. and hence already meet EUDR social requirements.
9. What do Operators and Traders need to demonstrate BEFORE placing natural rubber products on the EU market?
- Step 1 – Information Gathering: Natural rubber produced on a plot of land (GPS or polygon coordinates) that has not been subject to deforestation after 31 December 2020, country, quantity, time, and date. Certified natural rubber from Vietnam, Thailand, Guatemala and Sri Lanka are all PEFC and or FSC-certified and comply with the 31 December 2020 cut-off date. PEFC certification cut-off date is 2010. FSC certification cut-off date is 2020.
- Step 2 - Risk Assessment: Produced in accordance with the laws applicable in the country of production in terms of: land use rights, environmental protection, forest-related rules, including forest management and biodiversity national and international labor rights, informed consent (FPIC), maintenance of Indigenous Peoples rights, tax, anti-corruption, trade and customs regulations. PEFC and FSC-certified supply chains have substantially similar requirements. Both PEFC and FSC International organizations are working to have their standards be fully compliant with EUDR.
- Step 3 – Risk Mitigation: Provide a Due Diligence statement to the EU Information System confirming that due diligence was carried out and that no risk, or only a negligible risk, was found that the relevant products do not comply with the requirements set in Step 1 and 2 above.
- Information System (IS) is the IT system that will contain the due diligence statements
10. Are there simplified requirements for natural rubber that comes from a country the EU assesses as “low risk”?
The EUDR is assessing the "risk profile" of countries of origin of natural rubber. Country assessment is pending, and Steps 1, 2 and 3 may be simplified for certain origin countries, e.g. countries with "low risk" will have more focus on Steps 1 and 2 than Step 3.
11. How will the regulations be enforced?
“Competent Authorities” established by the EUDR will determine if Operators and Traders comply with the Regulation; and whether the natural rubber products intended to be placed on and/or exported from the EU comply with the Regulation.
12. Are there penalties for non-conformance?
Yes, there are minimum threshold penalties depending on the risk assessment of the origin country and country laws:
- Natural rubber produced in a country classified as “standard risk”, the Competent Authorities of that country will have to annually check at least 3% of the Operators responsible;
- Natural rubber produced in a country classified as “high risk”, the Competent Authorities of that country will have to annually check at least 9% of the Operators responsible;
- Natural rubber produced in a country classified as “low risk”, the Competent Authorities of that country will have to annually check at least 1% of the Operators responsible;
13. What can a Competent Authority do if they determine there is non-compliance?
The Competent Authority may do the following (and is subject to changes from time to time):
- Immediate interim measures such as seizure or suspension;
- Rectifying or preventing non-compliance by withdrawing, recalling, donating, or disposing of non-compliant;
- Levy penalties: (i) fines expressed as a percentage of the total annual Union-wide turnover in the financial year preceding the fining decision (max of 4%); (ii) confiscation of non-compliant products, (iii) confiscation of revenues gained from non-compliant products and/or (iv) temporary exclusion for a period of up to 12 months
14. Can citizens file a non-compliant complaint?
Yes, ordinary people can file a substantiated complaint, and such is reviewed by the Competent Authorities.
15. What can EU Operators and Traders do to prepare?
EU Operators and traders should:
- Determine if a product falls under 1 or more of the 7 commodities regulated under the EUDR, e.g., a natural rubber product (wetsuit);
- Understand the supply chain including the natural rubber producer, country benchmark (standard, high or low risk), GPS coordinates of plots of land where the natural rubber is produced;
- Determine whether the natural rubber is in areas where deforestation or degradation has occurred after 31 December 2020;
- Understand the laws applicable in the countries where the natural rubber is produced;
- Start collecting information of the relevant natural rubber products produced from 29 June 2023 which will be placed on, made available, or exported from the EU market from 30 December 2024.
Can Yulex help?
Yes, we are certified natural rubber supply chain experts and PEFC and FSC certification organizations are working hard to be compliant with EUDR, hence our supply chains will also be compliant with EUDR.
We continue to innovate our certified supply chains in addition to just certification:
1. We created an Equitable Ag (profit-sharing) program;
2. We are co-developing an app to bring integrity, security, privacy and efficiency to our Vietnam, Thailand and China supply chains, with Decathlon's assistance (sponsors). The digital tracing app will be EUDR & GDPR (privacy regulation) compliant as well as compliant with data privacy laws in Vietnam, Thailand and China.
Reach out to us if you are an existing customer or brand using Yulex products and need help with EUDR compliance.