Relying on Forest Stewardship Council (FSC) Certification or the Programme for Endorsement of Forest Certification (PEFC) for risk assessment as part of undertaking due diligence.
Who does this notice affect?
This compliance advice notice applies to importers of regulated timber products who use FSC Certification or PEFC as part of their due diligence to comply with the requirements of the Illegal Logging Prohibition Regulation 2012 (the Regulation).
The Department of Agriculture has identified a common misunderstanding about sourcing FSC and PEFC certified products.
Some importers are assuming that all products sourced from companies with FSC or PEFC Chain-of-Custody (CoC) certification are certified. This is not correct. CoC certified companies can handle both certified and uncertified products.
The Regulation recognises timber products that are harvested from forests certified to the forest management standards of FSC or a PEFC have a low risk of having been illegally logged. The Regulation also recognises that products that are certified to the CoC standards of FSC and PEFC have a low risk of having been illegally logged.
This notice provides the department’s position on what is considered compliant with the regulatory requirements for three different scenarios when relying on FSC or PEFC certification in risk assessments.
- The product you intend to purchase is FSC or PEFC certified
- Product or inputs are certified only to a point in the supply chain
- The product is not FSC or PEFC certified but the supplier or sub-suppliers hold FSC or PEFC CoC certification
Glossary of Terms
Product:A regulated timber product whose tariff code heading is listed in the Regulation.
Importer: The owner of the product when it in arrives in Australia, and as declared to the Australian Customs and Border Protection Services (Customs).
Supplier: The business that the importer sourced the final product from.
Sub-Supplier: Any business in the supply chain from sourcing, processing, manufacture or who value-add to the final product prior to it being received by the Supplier.
Scenario 1: The product you intend to purchase is FSC or PEFC certified
If you intend to purchase FSC or PEFC certified product, the Regulation recognises that these products are at a low risk of having been illegally logged.
In this circumstance, if you can demonstrate the product is certified, you would be meeting the ‘Timber Legality Framework’ risk assessment option.
Product certification can be demonstrated by the transportation documents (such as delivery dockets or invoices) stating the certification claim:
- the FSC certificate code and claim type statement (FSC 100 %, FSC Mix, FSC Controlled Wood or FSC Recycled), or
- the PEFC certification claim (X % PEFC Certified or PEFC Controlled Sources).
Good practice would be to maintain purchase order records requesting certified product to demonstrate that certified product was ordered prior to import.
Scenario 2: Product or inputs are certified only to a point in the supply chain
If a product or the inputs into the product you import are certified only to a point in the supply chain, then the Timber Legality Framework cannot be used as the risk assessment option.
Instead you must choose another of the remaining two regulated risk assessment options. That is, either a risk assessment using a Country Specific Guideline or a risk assessment against the regulated risk factors.
The information that the product is certified under FSC or PEFC CoC up until a point in the supply chain can be taken into consideration as part of a risk assessment against the regulated risk factors.
The regulated risk factors are:
- the risk of illegal logging in the general area of harvest
- illegal logging of the species in the area of harvest
- any armed conflict in the area
- the complexity of the product (and supply chain)
- any other information that may increase or decrease the risk that the product was illegally logged.
Where the product is certified under FSC or PEFC CoC up until a point in the supply chain, then the risk of the product up until that point can be considered to be low. Tracing back to the area of harvest is not required. That is, the risk associated with risk factors 1 to 3 that relate to the area of harvest can be considered as low.
Consideration of the supply chain and product complexity from that point onward to the point of import is required to ensure there is a low likelihood of mixing or substitution with other timber or wood fibre that may have been illegally logged.
To assess these risks, the importer should consider:
- whether the inputs are then transformed or repackaged, as these processes may be opportunities for other product to be added or substituted
- whether there are controls in place to reduce the likelihood of product or fibre substitution.
When the goods have not been transformed or repackaged, controls on the supply chain can be demonstrated by providing:
- invoices for the product to the first point in the supply chain without CoC with the formal certification claim, and/or
- the invoice or other purchase documentation to and from subsequent suppliers that show the product is the same. For example, this could be through the description of the goods or freight-related identifiers such as pack numbers or by the supply chain links being owned by the same parent company.
When the goods have been transformed or repackaged, controls on the product inputs can be demonstrated in a number of ways, for example, by providing:
- evidence of efforts (such as audits) to verify the supply chain and that there is little likelihood of mixing or substitution with non-certified inputs occurring
- evidence from a trusted supplier, such as a supplier statement, that no mixing or substitution has occurred or that all inputs into the product are certified
- other evidence, such as linking the timber type inputs through purchase orders or other documents.
Scenario 3: The product is not FSC or PEFC certified but the supplier or sub-suppliers hold FSC or PEFC CoC certification
Even if the supplier or sub-supplier holds FSC or PEFC CoC certification, if the product you import is not FSC or PEFC certified, the Timber Legality Framework cannot be used as the risk assessment option.
Instead you must choose another of the remaining two regulated risk assessment options. That is, either a risk assessment using a CountrySpecific Guideline or a risk assessment against the regulated risk factors.
The evidence that your supplier or sub-supplier is FSC or PEFC CoC certified can be taken into consideration as part of a risk assessment against the regulated risk factors (refer to Scenario 2). In particular it could be used against the fifth risk factor (that is, ‘any other information that may increase or decrease the risk that the product was illegally logged’).
However, the department considers that CoC certification of a supplier or sub-supplier only has a minor effect in reducing the risk of importing illegally logged product.
The department recognises that FSC and PEFC CoC certified businesses have the awareness, capacity and systems in place to be able to supply certified products and/or inputs to products. However, they are under no obligation to do so.
FSC CoC certified businesses must sign a policy of association with FSC to commit to not knowingly purchase illegally harvested timber. There are mechanisms within the FSC system to deal with allegations of non-compliance with this undertaking. However, the uncertified products are regarded as having ‘unspecified’ risk. This is not the same as low risk. The PEFC’s CoC certification system has similar mechanisms.
All Compliance Advice Notices are available on the Department’s website at: Illegal Logging Compliance Advice Notices.
Please direct any questions about the compliance assessment process to: firstname.lastname@example.org or by phoning the department on 1800 657 313.
You can subscribe to the department’s electronic mailing list to keep up to date on new developments with the illegal logging laws.
You can access additional information on the illegal logging laws by:
- reading our frequently asked questions and further information and resources web pages
- emailing the department’s illegal logging policy section or the illegal logging compliance section with a question related to the illegal logging laws. The department will respond to you within 10 working days
- calling the department during business hours (8.30 am to 5.30 pm) on 1800 657 313 or if outside of Australia on +61 2 6272 3933.