On the morning of Tuesday (6), parliamentarians of the European Union (EU) reached a preliminary agreement with the governments of the bloc for a new law that will force companies to check and issue a statement that the products placed on the market have not led to deforestation and forest degradation anywhere in the world. According to the agreed text, although no country or commodity is banned, companies will not be able to sell their products in the EU without such a declaration.

Companies will also have to verify compliance with the relevant legislation of the country of production, including on human rights and whether the rights of the indigenous peoples involved have been respected. According to the EU, the new law would assure European consumers that the products they buy do not contribute to the destruction and degradation of forests, including irreplaceable primary forests, thereby reducing the EU's contribution to climate change and global biodiversity loss.

The products covered by the new legislation are: cattle, cocoa, coffee, oil, soy and wood, including products that are prepared with these commodities (such as leather, chocolate and furniture), as provided for in the original proposal of the European Commission. During the discussions, parliamentarians successfully added rubber, coal, printed paper products and various palm oil derivatives to the law.

Parliament also secured a broader definition of forest degradation that includes converting primary forests or forests into natural regeneration into planted forests or other wooded land and converting primary forests into planted forests, Reuters reports.

The Commission shall assess, within one year of the entry into force of the legislation, whether to extend the scope to other wooded land. The Commission will then assess the extension of the scope to other ecosystems, including land with high carbon content and high biodiversity value, as well as other basic products.

Parliamentarians will also assess the need to force EU financial institutions to provide financial services only to their clients if they assess that there is only an insignificant risk that these services will not lead to deforestation.

EU competent authorities will have access to information provided by companies, such as geolocation coordinates, and carry out checks. They can, for example, use satellite monitoring and DNA analysis tools to verify the origin of products.