EUDR Compliance: Deforestation vs. Forest Degradation—What’s the Difference?

As we move through 2026, the EU Deforestation Regulation (EUDR) has transitioned from a future requirement to an active legal framework. For businesses importing or exporting key commodities in the European market, the clock is ticking.

To remain compliant, companies must look beyond simple tree counts. In the eyes of the EU, there is a critical distinction between deforestation and forest degradation. Understanding this nuance is now the primary factor in determining whether your goods clear customs or face a costly market ban.

Establishing the Baseline: What is a Forest?

The EUDR adopts the UN Food and Agriculture Organization (FAO) definition to remove any "grey areas":

• Size: Land spanning more than 0.5 hectares.

• Height: Trees taller than 5 meters.

• Canopy Cover: More than 10%.

This includes both natural forests and plantations, but it specifically excludes land used predominantly for agriculture (like fruit orchards) or urban development.

The Two Pillars of Compliance

Under the EUDR, any product derived from cattle, cocoa, coffee, oil palm, rubber, soya, or wood must be "deforestation-free." This means the product was produced on land that has not been subject to either of the following after the December 31, 2020 cut-off date:

1. Deforestation: Forest-to-Agriculture

Deforestation is the conversion of forest to agricultural use, whether human-induced or not.

• Example (Cattle): A forest in the Amazon is cleared to create new pastureland for beef cattle. Even if legal under local law, this is a violation of EUDR.

• Example (Coffee/Cocoa): A farmer removes native trees to plant more coffee shrubs. Because coffee is an agricultural crop, this is considered deforestation.

• Example (Palm Oil/Soya): Clearing a wooded area to plant soy or oil palm. Even though oil palms are "trees," they are classified as agricultural land under EUDR.

  
  

2. Forest Degradation: Structural Changes

Degradation targets structural changes that reduce a forest's ecological value. It specifically prohibits converting primary forests (untouched, native ecosystems) into plantation forests or other wooded land.

• Example (Timber): A primary forest of native species is harvested and replaced with a monoculture pine plantation for timber. Although trees remain, the "structural change" is classified as forest degradation.

• Example (Natural Regeneration): A forest that was naturally growing back is cleared to make way for a managed rubber plantation. This conversion is a direct violation under the degradation criteria.

  
  

Why the Distinction Matters for Your Data

While deforestation is often visible via standard satellite imagery, forest degradation is more subtle. It involves losing carbon storage and biodiversity while the canopy may still look "green" from a distance.

For compliance, both require precise geolocation data—specifically polygon maps for plots over 4 hectares—to prove the land’s status hasn’t changed since the 2020 deadline. Non-compliance can lead to fines of up to 4% of your total annual EU turnover, confiscation of products, and exclusion from public procurement.

How We Can Help: Your Path to EUDR Compliance

The regulatory landscape is shifting rapidly, and the "grey areas" of forest management are disappearing. We provide the expertise and tools you need to bridge the gap between field-level reality and legal documentation.

1. Customs Consultancy and Advice

We provide a bespoke EUDR setup tailored to your specific supply chain. Our experts help you establish a robust Due Diligence System (DDS), ensuring you can trace, assess, and document every batch of product from source to shelf. We help you navigate the "Information System" (Registry of Due Diligence Statements) so your customs declarations are airtight.

2. Training: On-Site, Virtual, or On-Demand

Education is the first step toward compliance. We offer a range of training options for your procurement, legal, and logistics teams:

• Full-Day Intensive Workshops: Deep dives into technical requirements and risk mitigation.

• Short Awareness Training: High-level briefings for executives and stakeholders.

• Flexible Formats: Available live in-person, live virtually, or via pre-recorded on-demand sessions.

  
  

3. Trade Intelligence: The Customs Watch EU

Never miss a regulatory update. Our strategic intelligence weekly briefing, The Customs Watch EU, monitors EUDR developments in real-time. From changes in country risk benchmarking to new enforcement guidelines, we keep you ahead of the curve.

Ready to secure your market access? [Book a call with our experts today] to start building your bespoke EUDR compliance system, or sign up for a 30-day free trial of The Customs Watch EU to see our intelligence in action.