The EU Deforestation-Free Regulation (EUDR) imposes strict requirements on the import and export of products that contribute to deforestation. This regulation applies to a range of commodities, including timber, soy, palm oil, cocoa, coffee and beef. The aim of the EUDR is to free the European market from products obtained through deforestation or forest degradation, which is an important step in the fight against climate change and biodiversity loss.
For trading companies that trade in these commodities, the EUDR brings not only new obligations, but also new opportunities. One of the crucial aspects of this regulation is the use of document codes.
What are document codes?
Document codes are customs codes used to provide specific information on regulatory compliance when importing or exporting certain products. These codes indicate whether the correct documentation is present and whether the product meets the requirements of the EUDR. Each document code refers to a specific obligation or exemption, and they help customs authorities to quickly assess whether products are compliant with the regulations.
Failure to use these codes correctly can result in delays, fines, or even seizure of goods. For companies trading in commodities covered by the EUDR, it is therefore essential to know exactly which document codes apply and how to use them.
Why are document codes important for trading companies?
For trading companies importing or exporting soy, timber, palm oil, cocoa, coffee and beef, the EUDR rules impose various administrative obligations. Companies must be able to demonstrate that their products are deforestation-free and that they meet the due diligence requirements set out in the regulations.
Document codes play a key role in this process, as they link the required documentation to the specific products being traded. This makes it easier for customs to verify that companies are adhering to the law, while providing a way for companies to prove that they are compliant.
Using document codes correctly not only helps to avoid delays and fines, but can also contribute to a company’s reputation. Customers and partners increasingly value sustainability, and being able to demonstrate that your company meets stringent environmental standards can provide a competitive advantage.
Which document codes are relevant for the EUDR?
The following are the most important relevant codes for companies trading relevant commodities or derivative relevant products covered by the EUDR:
- C716 - Use this document code for products that fall under the Regulation and for which a Due Diligence Statement must be available upon import and export. See Article 3 of the Regulation.
- C717 - Use this document code as an SME if a due diligence statement has already been submitted for your products. In addition to this document code, you must also state the reference number of that previously submitted statement in your declaration. See Article 4, paragraph 8 of the Regulation.
- Y129 - Use this document code for products that are exempted via the ’ex’ codes in Annex I of the Regulation and are not covered by the Regulation.
- Y132 - Use this document code for products that fall under Annex I of the Regulation, but that were produced before 29 June 2023 and to which the Regulation therefore does not apply. See also Article 1(2) and Article 38(1) of the Regulation.
For timber and timber products, please note the exception under Article 37(3) of the Regulation. - Y133 - Use this document code for products that are not covered by the EUDR because they are made from materials that have completed their life cycle and whose materials would have been considered waste if they had not been used in your production process. An exception to this are by-products from the production process, where materials were used in the production process that would not be considered waste within the meaning of Article 3(1) of Directive 2008/98/EC.
- Y141 - Use this declaration code if you are an SME or sole proprietorship (as referred to in Article 2, paragraph 30 of the Regulation). The Regulation will enter into force for you on 30 June 2025. The 6-month deferral only applies to SMEs and sole proprietorships that were registered with the Chamber of Commerce no later than 31 December 2020. See Article 38, paragraphs 2 and 3 of the Regulation.
Was your SME or sole proprietorship established after 31 December 2020? Then the Regulation will enter into force for you from 30 December 2024.
This deferral does not apply to micro-enterprises and SMEs that already trade in wood. See Article 38, paragraph 3 of the Regulation - Y142 - Use this declaration code when you file a return for non-commercial activities. These activities are exempt and do not fall under the regulation.
How can companies use document codes effectively?
Using document codes requires due diligence and accurate record-keeping. Companies must first map out which products fall under the EUDR and which codes apply. This can vary per commodity. Here are some steps companies can take to use document codes effectively:
Analyze the product chain: Companies must analyze their entire supply chain to determine which products fall under the EUDR and what documentation is needed. This means looking not only at the origin of the product, but also at the dates the product was produced and whether it meets sustainability criteria.
Collect the right documentation: For each product that falls under the EUDR, companies must collect the required documentation and ensure that it is up to date. This can range from sustainability certificates to due diligence declarations. These documents must be available at the time of import or export.
Use the correct codes: Companies must ensure that they use the correct document codes when completing their customs declarations. This requires a good understanding of the different codes and their applications. Errors in the use of document codes can lead to delays or penalties.
Train employees: It is important that employees responsible for import and export are well trained in the use of document codes and the EUDR rules. This prevents errors and ensures that the company remains compliant.
Stay up to date with legislation: The EUDR is a complex and constantly evolving regulation. Companies must therefore remain proactive in following updates and changes to the legislation. This may involve regular contact with customs experts or legal advisors.
More details can be found on the page “EUDR: European Union rules for deforestation-free products” on the Tax Authorities’ website.
