Approaches to Timber Legality

Assurance

Concepts and

Lessons Learnt

4th Sub-regional TLAS Workshop

Andy Roby

Vientiane, October 2014

The Presentation

1.The Origins of FLEGT

2.Legality Assurance

3.VPAs – some basics

4.Lessons learnt

Who am I? Andy Roby

Tropical forester (Bangor, Oxford), Henley MBA, 30 years working in international development (Africa, Latin America, Asia) including 5 years in the UK timber trade

Current work: since 2008 on the Indonesian timber licensing scheme to ensure only legal timber is exported to Europe – the so-called “FLEGT VPA process”

1. Illegal Logging:

The nature of the challenge Multiple forms – illegal logging can involve forestry, environmental,

economic and social infractions

No single definition – legality is defined in accordance with national

legislation

Many scales – from small to industrial or large scale

Many perpetrators – from local communities to highest level of

government

Many agencies contribute to enforcement – police, customs, forest

rangers, border guards, etc.

Interaction between illegal timber and other trafficking

Consumers remain largely unaware that what they are buying may

be illegal

Where FLEGT really started

Timber legality – a personal

journey

• Pre-1998: See No Evil, Hear No Evil, Speak No Evil

• G8 Birmingham meeting: “illegal logging, corruption”

brought the G8 Action Plan on Forests

• Danish and UK 2000 timber procurement policy

established the market factor as a driver

• Bali 2001 Declaration - the partnership between

consumers and producers

• In 2003 Indonesian Forestry Minister Prakosa’s

challenge - “stop buying our illegal timber”

February 2003

The story continued….

• Greenpeace “Partners in Crime” campaign 2003

• targeted the UK government

• hit the trade

• the trade responded

• And then we started to understand the power of the market

• In 2003 the EU took the East Asia FLEG process, added the “T” and the FLEGT Action Plan started up

• In Indonesia civil society started work on a legality definition

• UK, NL and Belgium traders joined together to do the Timber Trade Action Plan; cleaning up supply chains in response to the Greenpeace campaign

• FLEGT Regulation in 2005 gave us the VPA and in 2007 the first countries agreed to start negotiations

FLEGT Concepts• Timber legality definitions;

• Timber legality systems;

• Independent Monitoring

• Credibility

• Something for everyone

• The importance of the market driving the process

• If one constituency doesn’t want it, it won’t work

• Legality assurance….

2. Legality Assurance

• The confidence that what you are buying is legal and will

not

• ruin your reputation

• keep you up at night

• cost you a fine or

• put you in jail

• But what is legal timber?

and

• How do you know if the timber is legal?

VPAs require a Timber Legality Assurance

System or TLAS

1. Timber Legality definition (country specific). – what does legal timber look like

2. Supply chain control system (traceability system) – making sure no illegal timber gets into your products

3. Verification System (both supply chain & legality). – making sure the systems are working properly

4. Timber Licensing (Issuance of FLEGT Licenses) – the bit that EU customs will check when the shipments come in

5. Independent Audit of the entire TLAS – for credibility and to make sure the whole VPA is working well.

1a) Key Elements of the Legality

Definition

• Key bits of national legislation – these tellyou the timber is legal

• Derived from a multi-stakeholder processwith wide consensus

1b) Legality Definition

Every legality definition should cover:

i. rights to harvest;

ii. forest management including -

community rights and welfare;

environmental legislation;

labour, health & safety policies;

iii. taxes, import–export duties, royalties and fees;

iv. respect for tenure and use rights;

v. trade and export procedures.

2a) Supply Chain Control System

Routinely ensures the integrity of

timber product flows from A) the stump

or the point of import to B) the point of

export by using traceability verification

methods.

RECONCILIATION

Transport Processing ExportForest

Border entry point

VALIDATION

Verification Verification Verification Verification

Trade

Verification

2b) Basic Supply Chain Control Systems

3a) Verification System

1. Verification system ensures compliance with –

i. the elements of the Legality Definition, and

ii. the supply chain control system.

2. Verification is a systematic process based ondocumented procedures and protocols definingmethodologies, frequencies and differentpeople/administrations involved for cross-checking andverifying compliance.

3. Essentially defining the “who, what, when, where &how”

3b) Verification System

4. Extends beyond verification checklists & includes entireadministration, execution of the system, resourcesneeded, non-compliances as well as complaintprocedures (others).

5. Approaches to verification:

i. Shipment-based: Compliance verified perconsignment.

ii. Operator-based: Operator’s internal control systemsverified periodically to ensure compliance with LD.

iii. Hybrid systems: possibility exists.

4) Licensing

1. Definition : licenses issued on the basis of evidence of legal

compliance provided by verification systems.

2. Under the FLEGT regime, one FLEGT License should be issued for

each shipment exported to the EU.

3. Issued by Licensing Authority (independent from verification

body/agency) established / assigned in VPA partner country.

4. Before “going live”, TLAS will be assessed independently against

preset criteria provided in a specific VPA annex.

5. Once FLEGT Licensing system is operational in a VPA country, EU

border control agencies will only allow shipments of timber products

(covered by the VPA) from that Country if they are covered by

FLEGT licenses.

Imported timber, FLEGT

licensing & EUTR

European Union

Member States

Operating VPA

country

Non VPA

country

Non VPA

country

Non VPA

country

Operating VPA

country

Non VPA

countries

Timber flows under FLEGT

Licensing (EUTR)

Timber flows under due

diligence requirements

(EUTR)

Timber flows under

recognised mechanism

determined in VPA country

5) Independent Audit

1. Continuous monitoring TLAS & its implementation in orderto inter alia identify possible system weaknesses & suggestimprovements - irrespective of who carries out verification.

2. Reports the monitoring results to the Ministry in charge offorests and the Joint Implementation Committee (JIC).

3. Report is published for the general public.

4. Clear independence from organisations and individualsinvolved in management of LAS

A transparent mechanism for appointment of the ThirdParty Monitor.

5. Opportunity for civil society involvement and critique.

Interaction between the 5

elements of Timber Legality

Assurance Systems

(TLAS)5. Independent Audit

3. Verification of

compliance for operators

and timber products

1. Legality

Definition

2. Timber

Supply chain

4. Issuing of

FLEGT Licenses

1. Loss of Momentum

“Negotiating is very exciting. Implementation not so exciting”

Transition plan (clarification of roles, priorities, funding).

Regular inter-agency (National) & inter-party meetings (JIC).

Maintaining stakeholder involvement (Industry, civil society, etc).

2. Lost in Complexity

“One size fits all, not all shoes fit”.

Development can be complex – keep it realistic, practical and

implementable.

3. Maintaining Stakeholder involvement throughout

Coordinated support, acceptance and balanced process (transparency

and accountability).

4. Lessons Learnt (1)

4. Losing sight or focus

Prioritising one aspect (i.e traceability) & neglecting adequate in

parallel processes needed for VPA implementation.

Uneven capacities to address the different activities.

Too much focus on tools and technology.

Shifting attention and dividing resources to other sector initiatives.

5. Capacity Building & Resources

More complexity means higher costs.

Funding options (sustainability of implementation).

Introduce new requirements : steep learning curve for all actors.

6. Dealing with contemporary issues

Domestic markets, imports, timber in transit and more...

4. Lessons Learnt (2)

Concluding RemarksFLEGT licensed timber is the goal but many useful governance reforms

come along the way

The market is key – without the private sector would not have got

interested…..

It takes time, so you need intermediate benefits to keep stakeholders

engaged

VPA’s may not be the only answer but they are a powerful tool

It’s a big job and it’s complicated but there are big rewards

Civil society inputs crucial for credibility and restoring trust/belief

Thank You