Only months remain before the EU's new deforestation regulation takes effect, raising serious concerns for the Swedish wood and forest industries. Erik Haara, CEO of the Swedish Federation of Wood and Furniture Industry (TMF), and Viveka Beckeman, CEO of the Swedish Forest Industries Federation, urge the government to push for a delay in implementing the law. In a Dagens industri article, they warn that the regulation, in its current form, could severely impact Swedish businesses unless changes are made.
The deforestation regulation, effective at the end of the year, aims to prevent trade in commodities contributing to deforestation, including wood, soy, rubber, and livestock. Swedish companies will face new requirements for traceability and extensive reporting. However, the legal framework remains incomplete, creating significant uncertainty. Companies that cannot comply in time face possible sanctions or even being forced out of the market.
Despite the regulation’s December deadline, businesses still lack practical instructions on how to comply. Over 60,000 Swedish companies are expected to be affected by the new requirements, but the specifics of these obligations remain unclear. The Swedish authorities have expressed concern that the new rules will disproportionately affect businesses in the country, where deforestation is not a significant issue.
One major criticism is that the law does not distinguish between high- and low-risk countries for deforestation. This means that nations like Sweden, with minimal deforestation concerns, are treated the same as high-risk regions like Brazil or Indonesia. The Swedish Forest Agency has pointed out that deforestation is not a major problem within the country or the EU.
The law has faced international criticism as well. Major trading partners, including the United States and China, have questioned its feasibility. EU ambassadors and several member states have called for more time to implement the regulation, while agricultural sectors across the continent have expressed alarm over its broad scope.
Haara and Beckeman argue that while the regulation’s goals of combating deforestation are commendable, its current design risks harming businesses that have been leaders in Sweden's green transition. They urge the Swedish government to take the lead in pressing the EU for a delay, allowing more time for clearer guidelines and more practical enforcement mechanisms. Without adjustments, they warn, the regulation could undermine the competitiveness of Sweden’s forest and wood industries, which play a crucial role in rural employment and economic growth.
