Restrictions on trade are one option under consideration by federal agencies tasked with reviewing how to address deforestation associated with commodities.

The State Department is working with U.S. Customs and Border Protection, the Office of the U.S. Trade Representative, and other agencies to prepare a report outlining a whole-of-government approach to this issue. To aid in that effort, State is inviting comments on a wide range of related issues by Dec. 2.

Among other things, State is interested in which of the following government measures might be most effective in limiting or removing specific commodities grown on deforested lands from agricultural supply chains.

- restricting imports of commodities grown on lands deforested either illegally or after a specific cut-off date (e.g., Dec. 31, 2020)

- requiring covered entities to conduct due care for transparency and traceability to eliminate or minimize the risk that commodities in agricultural supply chains, or the products produced from such commodities, were grown on deforested lands (and how such due diligence might be conducted, whether third-party audits should be required, and if and how entities would provide notice or documentation)

- requiring covered entities to have full traceability of covered commodities (including the level of proposed traceability; information that should be collected and retained at each point in the supply chain; potential data sources, collection methods, and retention rules; and potential costs and impacts on agricultural supply chains) and how this might be verified by importers to assure compliance

- incentivizing the use of commodities produced in jurisdictions with low deforestation rates or disincentivizing the use of commodities produced in jurisdictions with high deforestation rates

- enhancing transparency around commodity flows and deforestation to inform importers and investors

- phasing in substantial penalties for noncompliance with any approach the government ultimately takes

Related issues on which comments may be submitted include the following.

- whether all soft commodities (those that are grown rather than extracted or mined) should be covered or just some (e.g., cattle, oil palm, soy, cocoa, coffee, wood fiber, and rubber, which reportedly account for about three-fifths of deforestation worldwide)

- which entities should be covered (e.g., direct importers, commodity traders, consumer goods companies, retailers, financers, etc.)

- how the U.S. should focus its efforts (e.g., tariff codes or industries associated with commodities of greatest impact, countries with the highest volume or value of soft commodities imported into the U.S., etc.)

- de minimis exclusions for specific products, exporters, or importers

- exclusions or simplified requirements for small businesses

- the value of requiring “some declaration upon import of the location from which the commodity derived”

- existing commodity certification schemes that include illegal deforestation and whether they have been effective in reducing commodity-driven deforestation

- the costs and benefits to businesses of complying with traceability and transparency requirements already adopted by other countries

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