1. 1 EUFLEGT.EFI.INT THE FOREST LAW ENFORCEMENT GOVERNANCE AND TRADE TEAM OF THE EUROPEAN FOREST INSTITUTE © European Forest Institute Vincent van den Berk European Forest Institute – FLEGT Asia Wollongong, 23 February 2010 Forest Law Enforcement Governance & Trade FLEGT in the Asia-Pacific

2. 2 EUFLEGT.EFI.INT THE FOREST LAW ENFORCEMENT GOVERNANCE AND TRADE TEAM OF THE EUROPEAN FOREST INSTITUTE © European Forest Institute WHY EU FLEGT? What is EU FLEGT and how does it work? EU FLEGT initiatives in the Asia Pacific

3. Why EU FLEGT? Major consumer markets increasingly aware and critical (biodiversity, climate change, trade reputation, unfair competition, development opportunities lost, etc, etc..) Trends: Tropical timber = trouble? Customers want guarantees (at least legality) Gradually moving away from tropical timber 33 © European Forest Institute EUFLEGT.EFI.INT THE FOREST LAW ENFORCEMENT GOVERNANCE AND TRADE TEAM OF THE EUROPEAN FOREST INSTITUTE

4. © European Forest Institute 4 What is EU FLEGT? EU response: Implementation of the EU FLEGT Action Plan Key elements in place: a) EU market legislation (the Due Diligence Regulation) b) FLEGT Voluntary Partnership Agreements c) Public Procurement Policies in EU Member States d) Technical and Financial assistance for producer countries EUFLEGT.EFI.INT THE FOREST LAW ENFORCEMENT GOVERNANCE AND TRADE TEAM OF THE EUROPEAN FOREST INSTITUTE

5. © European Forest Institute 5 What is EU FLEGT? EU market legislation Proposal for new EU illegal timber trade legislation (the ’Due Diligence Regulation’) thoroughly discussed by European Parliament and the Governments of the 27 EU Member States (Council) in 2009. Application expected between end 2011 - 2013 EUFLEGT.EFI.INT THE FOREST LAW ENFORCEMENT GOVERNANCE AND TRADE TEAM OF THE EUROPEAN FOREST INSTITUTE

6. What is EU FLEGT? New EU market legislation, how it works: Objective: no illegal timber sold on EU market ’Due Diligence’ required from `operators´ `Operator´= Anybody supplying the EU market with timber products (imported or produced in EU) `Due Diligence´= set of procedures aimed at avoiding trading in illegally harvested timber 6 EUFLEGT.EFI.INT THE FOREST LAW ENFORCEMENT GOVERNANCE AND TRADE TEAM OF THE EUROPEAN FOREST INSTITUTE © European Forest Institute

7. What is EU FLEGT? New EU market legislation, how it works: Legislation covers all timber and timber products, Legality: Defined on the basis of the legislation of the country of harvest, as in FLEGT Voluntary Partnership Agreements (VPAs) covering 3 pillars of sustainabilty 7 EUFLEGT.EFI.INT THE FOREST LAW ENFORCEMENT GOVERNANCE AND TRADE TEAM OF THE EUROPEAN FOREST INSTITUTE © European Forest Institute

8. What is EU FLEGT? New EU market legislation EU traders must ensure due diligence by: Tracking the timber flows; Conduct risk assessment. Identifying the country of harvest Describing the product; Having access to reliable information on legal compliance 8 EUFLEGT.EFI.INT THE FOREST LAW ENFORCEMENT GOVERNANCE AND TRADE TEAM OF THE EUROPEAN FOREST INSTITUTE © European Forest Institute

9. New EU market legislation Under discussion between Commission, Parliament & Council: 1.First placing on EU market, or all operators (distinction between „first placing on the market“ (importers, producers) and „making available on the market“ (retailers etc.) 2.Risk assesment : minimize risk illegally sourced; ensure legally sourced 3.Applicable legislation in country of harvest as in VPA requirements or more? 4.The monitoring organisation avoidence of conflict of interest 5.Sanctions by EU member States with or without guidance 6.Exemptions; wood products for energy, recycled, no exemptions 7.Recognition of monitoring organisations in the EU 9 EUFLEGT.EFI.INT THE FOREST LAW ENFORCEMENT GOVERNANCE AND TRADE TEAM OF THE EUROPEAN FOREST INSTITUTE © European Forest Institute

10. What is EU FLEGT? FLEGT Voluntary Partnership Agreements: Set up control & licensing systems providing Government-backed guarantee of legality Legality definition based on laws & procedures of the timber producing country Legality assurance system covers chain of custody, verification, licensing & independent monitoring procedures 10 EUFLEGT.EFI.INT THE FOREST LAW ENFORCEMENT GOVERNANCE AND TRADE TEAM OF THE EUROPEAN FOREST INSTITUTE © European Forest Institute

11. What is EU FLEGT? FLEGT Voluntary Partnership Agreements: Defining legality I Partner countries identify a set of laws which together define ‘legality’ for the purpose of FLEGT Process: Definition to be developed through stakeholder consultations Content: Definition must be – consistent – objectively verifiable – operationally workable 11 EUFLEGT.EFI.INT THE FOREST LAW ENFORCEMENT GOVERNANCE AND TRADE TEAM OF THE EUROPEAN FOREST INSTITUTE © European Forest Institute

12. What is EU FLEGT? FLEGT Voluntary Partnership Agreements: Defining legality I Definition to reflect the three pillars of SFM and cover: The granting of legal rights to harvest Compliance with forest management regulations including relevant environmental and labour laws. Taxes, fees and levies Respect for other parties tenure/use rights Trade and export procedures 12 EUFLEGT.EFI.INT THE FOREST LAW ENFORCEMENT GOVERNANCE AND TRADE TEAM OF THE EUROPEAN FOREST INSTITUTE © European Forest Institute

13. InformationNegotiationFLEGT licencesPre-negotiationImplementation EU-China coordination mechanism on FLEG 13 EUFLEGT.EFI.INT THE FOREST LAW ENFORCEMENT GOVERNANCE AND TRADE TEAM OF THE EUROPEAN FOREST INSTITUTE © European Forest Institute

14. China Bilateral Cooperation Mechanism on FLEG signed 2009, implementation in 2010 14 © European Forest Institute EUFLEGT.EFI.INT THE FOREST LAW ENFORCEMENT GOVERNANCE AND TRADE TEAM OF THE EUROPEAN FOREST INSTITUTE

15. Trade statistics CountryTrade (EFI-WFSE Forest Products Trade Flow database 2007) VPA Total volume exported to EU Total export value exported to EU EU share of total export volume Status 1000 m 3 RWEMillion USD% 1 China 15,659.96,290.019%BCM 2 USA 20,321.44,618.212% 3 Russian Fed 36,742.34,360.433%Dialogue 4 Brazil 26,634.24,039.944% 5 Switzerland 10,691.02,698.991% 6 Norway 10,606.32,362.584% 7 Canada 10,698.02,040.75% 8 Indonesia 5,450.41,685.312%negotiation 9 Malaysia 2,617.61,221.57%negotiation 10 Chile 7,414.91,145.322% 13 Viet Nam 859.3904.214%preparation 15 Cameroon 2,757.2668.882%negotiation 16 Gabon 1,056.8558.929%negotiation 18 Thailand 470.4444.03%interest 21 Cote d Ivoire 948.5297.459%interest 26 Dem Rp Congo 436.4174.793%preparation 27 Ghana 380.2173.125%Concluded 28 Ro Congo 507.7133.651%Concluded

16. © European Forest Institute 16 EU FLEGT support initiatives in the Asia Pacific region VPAs (Indonesia and Malaysia), bilateral FLEGT support programmes EU and EU Member States FLEGT one of the themes under the Environment & Sustainable Management of Natural Resources (ENRTP). Global. Annual call for proposals ITTO’s Tropical Forest Law Enforcement & Trade (TFLET) Thematic Programme (ITTO Member Countries) ACP-FLEGT Support Programme, call for proposals (the 79 ACP countries) World Bank/PROFOR FLEG in Mekong (in prep) EU FLEGT Facility, jointly with EU, VPA interested countries, main focus Africa (global) EU FLEGT Asia Regional Programme (part of FLEGT Facility), jointly with EU EUFLEGT.EFI.INT THE FOREST LAW ENFORCEMENT GOVERNANCE AND TRADE TEAM OF THE EUROPEAN FOREST INSTITUTE

17. FLEGT Asia Regional Programme Focus on timber exporting countries with strong impact on regional trade – principally China and the Mekong countries Base line information India Additional support VPA processes Malaysia and Indonesia if necessary Other consumer markets in the Asia Pacific (Japan, South Korea, US, Australia & New Zealand) 17 © European Forest Institute EUFLEGT.EFI.INT THE FOREST LAW ENFORCEMENT GOVERNANCE AND TRADE TEAM OF THE EUROPEAN FOREST INSTITUTE

18. Approach of the FLEGT Asia Regional Programme Promote international trade in verified legal timber within Asia and from Asia to other consumer markets Enhance understanding of emerging demands in key timber consuming markets Assist buyers and sellers of Asian timber to meet these demands 18 © European Forest Institute EUFLEGT.EFI.INT THE FOREST LAW ENFORCEMENT GOVERNANCE AND TRADE TEAM OF THE EUROPEAN FOREST INSTITUTE

19. 19 Contact Us EUROPEAN FOREST INSTITUTE FLEGT Asia Regional Office c/o Embassy of Finland 5th Floor, Wisma Chinese Chamber 258, Jalan Ampang 50450 Kuala Lumpur, Malaysia Telephone: +603-42511886 Facsimile: +603-42511245 URL: www.euflegt.efi.int © European Forest Institute EUFLEGT.EFI.INT THE FOREST LAW ENFORCEMENT GOVERNANCE AND TRADE TEAM OF THE EUROPEAN FOREST INSTITUTE