The new deforestation regulation proposal published on Wednesday 17 November by the European Commission is the most ambitious global legislative initiative on deforestation to date.  

Yet while it is an important step forward, the current proposal has some serious gaps that threaten to limit its effectiveness, particularly as regards the protection of human rights, including the land and territorial rights of indigenous peoples and forest communities.  

Here are some of the key points: 

• The regulation applies to cattle, palm oil, soy, wood, cocoa and coffee. It requires businesses that sell or export these commodities in the EU to undertake due diligence to ensure that their production has not involved deforestation or forest degradation and has complied with national laws in the country of production. 
• The proposal is more ambitious than similar legislative initiatives in the UK and the USA, as it regulates not only illegal deforestation, but any deforestation linked to the production of these forest-risk commodities. 
• The proposed regulation doesn’t require compliance with international human rights law standards, in particular respect for customary tenure rights and the principle of free, prior and informed consent. This is a significant limitation for the rights of indigenous peoples and forest communities, whose rights are often inadequately protected by national laws. 
• There are likely to be substantial challenges with verification and enforcement by the designated competent authorities of EU member states, particularly in relation to compliance with national laws of producer countries. Assessment of compliance is likely to be plagued by issues including language barriers, lack of easy access to producer country laws, incoherent producer country legal frameworks and lack of legal expertise on these (multiple) foreign legal systems. 
• Access to information and transparency is limited under the regulation. While companies are required to trace to farm or plantation level, this information (and most other information from the due diligence process) will not be publicly disclosed. Companies are only required to publish general annual reports on their due diligence systems.  
• There are limited avenues for access to justice for indigenous peoples and forest communities harmed by companies’ failure to comply with their obligations. Neither civil nor criminal liability is included. Third parties do have a right to raise substantiated concerns with competent authorities (who may choose to take action against the company); however, the effectiveness of this option for indigenous peoples and forest communities is undermined by the lack of access to information, lack of a centralised enforcement system and potential language barriers, among other things.  
• The regulation fails to impose obligations on the financial sector, which is a major gap in delinking European influence on global supply chains that are causing deforestation.  
• Countries will be classified under a benchmarking system as either “low-risk”, “standard risk” and “high risk”. A “low-risk” classification substantially reduces due diligence obligations on products sourced from these areas – creating a significant risk of loopholes.  
• The proposed regulation only places strict requirements to avoid deforestation and forest degradation – it places no direct restrictions on the destruction of other ecosystems, such as grasslands, peatlands, mangroves and more, which means peoples and communities living in these areas may face increased risks of dispossession.  

While the deforestation regulation is a welcome and long overdue proposal, the failure to incorporate human rights is a major shortcoming, that is likely to limit its effectiveness and generate perverse outcomes. Deforestation and human rights violations are highly correlated, and indigenous and forest peoples are recognised as some of the best guardians of the forest. Not dealing with deforestation and human rights due diligence in an integrated way is a missed opportunity for a more effective and comprehensive regulation and out of step with global sustainability standards.