The European Council has reached a preliminary agreement to delay the EU Deforestation Regulation (EUDR)—the law designed to prevent products linked to global deforestation from entering or leaving the EU—by one additional year. The Council also signaled support for broader simplification measures that go beyond what the European Commission recently proposed. This position will now form the basis for negotiations with the European Parliament and, if finalized, would amount to the second one-year postponement of the regulation, originally slated to take effect at the end of 2024.

Why EUDR Matters

The EUDR was introduced in 2021 to stop deforestation-linked commodities—such as palm oil, beef, timber, coffee, cocoa, rubber, and soy—from entering EU supply chains. It requires companies placing these goods on the EU market or exporting them to complete mandatory due diligence, including:

• Tracing products back to the specific plot of land where they were produced

• Demonstrating the land was not deforested after 2020

• Confirming compliance with local laws in the producing country

This represents one of the most data-intensive transparency requirements ever implemented in a global supply chain regulation.

What Changed: Commission vs. Council Proposals

Last year, the Commission proposed the first delay to give companies time to build traceability systems. In late 2025, officials again considered a second delay, citing concerns that EU IT systems weren’t ready to handle the required data volume.

Although the Commission’s October 2025 proposal kept the original December 30, 2025 implementation, it added:

• A six-month enforcement grace period

• Extended compliance timelines for small enterprises (until end of 2026)

• Reporting simplifications focusing obligations on operators who first place goods on the EU market

• A “one-off declaration” option for small operators

The Council’s new position goes further. It would:

• Delay implementation to end of 2026 for large companies

• Delay until mid-2027 for small and micro-operators

• Limit due diligence retention to the first downstream operator, not all subsequent ones

• Allow traceability using postal codes instead of precise geolocation for small operators

• Mandate a formal simplification review in April 2026, opening the door to further reductions before the law takes effect

This last element is significant: it effectively pauses the regulation and signals a willingness to fundamentally restructure its requirements.

Growing Pushback from Industry

Several global companies—many of which have already invested heavily in EUDR-compliant traceability systems—issued a public letter criticizing the new delays. They argue that continuously shifting timelines and simplifying core requirements:

• Create uncertainty for companies building compliance programs

• Disadvantage early movers that have already invested in technology

• Slow the EU’s environmental ambition at a moment when global deforestation remains a major climate risk

What Happens Next

Members of the European Parliament will vote on their position next week. Parliament and Council must then negotiate a final agreement before the current December 30, 2025 implementation deadline. If the Council’s version prevails, companies—especially those with large commodity supply chains—should prepare for:

• A longer runway before full compliance

• Potentially lighter reporting obligations, particularly downstream

• Ongoing uncertainty as the April 2026 simplification review could meaningfully reshape the regulation