After weeks of speculation that the Regulation on deforestation-free products (the Regulation) was about to be delayed for a further year, a proposal for a regulation amending the Regulation was published by the European Commission (the Commission) on 21 October 2025. In its proposal, the Commission has moved away from a full-scale delay in favour of transitional arrangements and amendments. The Regulation will apply to large and medium-sized entities on and from 30 December 2025, but it is proposed that application for small and micro entities will be delayed until 30 December 2026 .
By scrapping the idea of delay, the Commission is hoping to appease those who condemned it. In its press release and documentation around the new proposal, the Commission has stressed that its “targeted simplifications” will ease the burden on the IT system, which was flagged as the impetus for considering a delay in the first place. However, those in favour of the Regulation will surely be displeased that the Commission is, once again, opening the Regulation up to amendment.
The proposed amendments should also appeal to critics of the Regulation in its current form; although some will argue that these reforms do not go far enough, and the concept of a ‘zero risk’ category is likely to be proposed by the European People’s Party again. (See this previous article for more on opposing views on the Regulation.)
Key amendments
So, what are these targeted simplifications? The Commission has proposed the following:
1. Six-month application delay for micro and small operators: The Regulation will apply to large and medium-sized operators from 30 December 2025 as planned, but its application to micro and small operators could be postponed by six months, until 30 December 2026.
2. Six-month enforcement moratorium: Large and medium operators will enjoy a six-month grace period, until 30 June 2026, where they will not be at risk of enforcement actions. During this period, national supervisory authorities will not carry out checks or other measures relating to enforcement. Where a competent authority becomes aware of non-compliance with the Regulation before 30 June 2026, it may issue warnings and recommendations on how to achieve compliance, but it may not take any further action until the moratorium ends.
3. Simplified, one-time statement for “micro and small primary operators”: Instead of the more onerous due diligence obligations placed on other primary operators, the Commission has proposed a one-time, simplified due diligence declaration for this new category. This simplified arrangement is aimed at small farmers and producers who are established in low risk countries (inside and outside the EU) and placing on the EU market, or exporting from the EU, products that they’ve grown, harvested, or raised.
The burden that the Regulation will place on small farmers and producers has been flagged by most critics of the legislation, so they will welcome this proposal. However, the proposed exemption has also been criticised. The Environmental Investigation Agency has remarked that it “will apply to most of the EU forestry sector, reducing EU forest protections and harmonised EU oversight and enforcement of the law”. On the other hand, the Fair Trade Advocacy Office has described the changes as “largely symbolic and disconnected from the actual structure of global supply chains”, because most non-EU micro and small producers do not sell directly to the EU.
4. New exemption for ‘downstream operators’ and traders: The most striking amendment is the Commission proposal to exempt downstream operators who are not small or medium-sized enterprises (non-SME downstream operators), as well as non-SME traders, from the obligations to:
ascertain that due diligence has been performed
prepare and file due diligence statements
SME operators and traders were already exempt from these requirements under the Regulation.
Under this revised model, responsibility for submitting due diligence statements would rest solely with the operator introducing the "relevant product" (as set out in the annex to the Regulation) into the EU market for the first time (the primary operator). To take the example given by the Commission: the importer of cocoa beans would need to submit a due diligence statement as the primary operator, but downstream manufacturers of chocolate products would not be required to submit individual due diligence statements.
Downstream operators and traders would not be relieved of all responsibility, however. Non-SME (i.e. large) downstream operators and traders would still be required to register in the IT system prior to exporting from, or placing a product on, the EU market, “since they have a significant influence on supply chains and play an important role in ensuring that supply chains are deforestation-free”. All downstream operators and traders (whether SMEs or not) would also be obliged to provide operators and traders downstream from them, whom they have supplied with relevant products, with the products’ reference numbers and/or declaration identifiers.
In addition, all downstream operators and traders would be obliged to collect and keep, for five years, the following information relating to the relevant products they intend to export from or place on the EU market:
names, addresses and due diligence statement reference numbers (or declaration identifiers) for all upstream suppliers of relevant products
names and addresses of the downstream operators whom they supplied with relevant products
5. Company size irrespective of legal form: Helpfully, the Commission has also recommended including a clarification that the definitions of micro, small and medium-sized enterprises, which are determined in accordance with the Accounting Directive, should apply irrespective of legal form.
What happens next?
The Commission’s proposal for an amending regulation requires the approval of both the European Parliament and the Council of the EU. With the commencement date of 30 December 2025 looming, the Commission has called on these institutions to “swiftly” adopt its proposal. However, given the opposing attitudes to the Regulation and the current difficulties that simplification legislation is encountering in the European Parliament, it is possible that the legislative process will not be concluded in time. The Commission has indicated that it is working on “contingency plans” in the event that this situation comes to pass. What these contingency plans might look like is not yet clear, but it might take the form of a Commission communication requesting that Member States refrain from enforcing the Regulation for a transitional period. We will be watching developments with interest!
For further information on this topic, please contact Anne O’Neill (author), Jill Shaw, or any member of ALG’s ESG & Sustainability group.
