This concept of complexity of the relevant supply chain is explicitly listed as risk assessment criteria of the EUDR and is therefore relevant to the risk assessment and risk mitigation part of the due diligence exercise. How can we identify a complex supply chain?
1 Answer
Anonymous User
The rationale underpinning this criterion is that tracing relevant products back to the country of production and plots of land where the relevant commodities were produced may be more difficult if the supply chain is complex. Failure to obtain the necessary information at any point in the supply chain can increase the possibility of non-compliant commodities or products entering the supply chain. What matters is the possibility of tracing the relevant commodities found in a relevant product back to the plots of land where they were produced.
The risk of non-compliance will increase if the complexity of the supply chain makes it difficult to identify the information required. The existence of unidentified steps in the supply chain can lead to the conclusion that the risk is non-negligible.
The complexity of the supply chain increases with the number of processors and intermediaries between the plots of land in the country of production and the operator or trader. Complexity may also increase when more than one relevant product is used to manufacture a new relevant product, or if relevant commodities are sourced from multiple countries of production.
In order to assess the complexity of the supply chain, operators and traders may use the following list of questions for relevant products to be placed on, or made available on, or exported from the Union market:
- Were there several processors and/or steps in the supply chain before a particular relevant product was placed on, or made available on, or exported from the Union market?
- Does the relevant product contain more than one relevant commodity?
- Does the relevant product contain relevant commodities sourced from several plots and/or countries of production?
- Is the relevant product a highly processed product (which may itself contain multiple other relevant products)?
- For timber:
Does the relevant product consist of more than one tree species?
Have the products been traded in more than one country?
Were any relevant processed products processed or manufactured in third countries before they were placed on, or made available on or exported from the Union market?