EU Deforestation Regulation (EUDR) - Where Things Stand in May 2026

Two years after the EUDR entered into force, the regulation looks noticeably different from what was originally adopted in May 2023. The entry into application has been pushed back twice and it now stands at:

• 30 December 2026 for large and medium-sized companies.
• 30 June 2027 for micro and small enterprises. 
• Note: Micro and small companies already covered by the EU Timber Regulation must still meet the 30 December 2026 deadline.

The Commission has framed these extensions as time bought for simplification, not delay for its own sake, and the April 2026 package suggests that framing is at least partially justified.

The Structural Shift in Due Diligence 

The most consequential change is not a date but a structural one. Under the revised framework adopted in December 2025, the full weight of due diligence now sits with the upstream operator. Everyone else in the supply chain has had their obligations scaled back substantially:

• Upstream Operators: The first party placing a relevant product on the EU market bears full due diligence responsibility.
• Downstream Operators: Companies manufacturing a regulated product from another regulated product are no longer required to conduct their own assessment. Their obligation is limited to passively collecting Due Diligence Statement (DDS) reference numbers from their direct suppliers.
• Non-SME Traders: Distributors and resellers need only register in the Information System and retain basic contact information about their suppliers.
• The Exception: If a downstream operator or trader becomes aware of a "substantiated concern" regarding non-compliance, they must immediately inform the competent authorities and verify the risk before proceeding.

Ultimately, this is a meaningful shift for the majority of industrial companies who interact with regulated supply chains at arm's length rather than at the point of origin.

Country Risk Classification and Simplified Due Diligence
Not all operators face the same level of due diligence burden. The Commission classifies countries and sub-national regions as low, standard, or high risk, based primarily on deforestation and forest degradation rates drawn from FAO Global Forest Resources Assessment data, supplemented by governance indicators. Operators sourcing exclusively from countries classified as low risk qualify for simplified due diligence under Article 13. They are still required to collect the information set out in Article 9 and to assess supply chain complexity and circumvention risk, but they are not required to complete the full risk assessment and risk mitigation steps under Articles 10 and 11. 
The current list of classified countries is set out in Commission Implementing Regulation (EU) 2025/1093.

• Low-Risk Sourcing: Operators sourcing exclusively from low-risk countries qualify for simplified due diligence. They must collect basic information and assess circumvention risk, but skip the full risk assessment and mitigation steps.
• Mixed Sourcing: The simplification cannot be applied across the board. It covers only the specific portion of supply proven to originate entirely from a low-risk country.

What the Draft Delegated Act Proposes to Change in the Product Scope
In parallel with the April 2026 report, the Commission published a draft Delegated Act amending Annex I - the list of products that actually triggers EUDR obligations. A four-week feedback window ran from 4 May to 1 June 2026 on the Commission's Better Regulation "Have Your Say" portal, and the act is not yet in force. Until it is formally adopted, the current Annex I continues to apply.
Several of the proposed changes matter significantly for industrial supply chains.

• Retreaded Tyres: The scope is narrowed down precisely. Only the new rubber tread added during retreading remains covered, while the carcass and casing fall out of scope entirely.
•  The "ex" Prefix: A product is only in scope if it is actually made from the regulated natural commodity. For example, tyres manufactured entirely from synthetic rubber are not covered. For automotive and heavy equipment supply chains, where synthetic materials frequently appear alongside natural ones, confirming the material composition of a component is the first and most important step in assessing whether an EUDR obligation arises at all.
•  Horizontal Exemptions: For samples and testing materials consumed or destroyed in the process, transport packaging, waste and second-hand goods, and marketing materials. For aerospace and automotive companies, where qualification batches and material samples are routinely exchanged, this testing exemption finally provides a clear legal basis that was missing before.
• Removals & Additions: Cattle leather is proposed for complete removal, while selected products like soluble coffee, palm oil derivatives, and frozen cattle tongues are proposed for inclusion

Where Companies Typically Run Into Difficulty
The regulation's interaction with industrial and manufacturing supply chains is one of the areas where misunderstandings are most common. The finished vehicle, electrical device, or aircraft is not listed in Annex I. That much is clear. The difficulty lies one step earlier in the components and materials that go into those products.
Take tyres as a practical example. 

• Direct Import (Operator): An OEM or Tier-level supplier importing natural rubber tyres directly from outside the EU is an operator for those tyres. The obligation to submit a DDS attaches to the moment the product is placed under customs clearance. It does not matter if the tyres are for spare parts resale or internal assembly line use.
• EU Sourcing (Downstream): A manufacturer sourcing those exact same tyres from a European supplier who has already completed due diligence acts as a downstream operator, with no assessment requirement of its own.

What Comes Next

1. IT System and Registration Timeline

The EUDR Information System is the central IT platform through which operators submit Due Diligence Statements, and downstream operators and non-SME traders register their participation in regulated supply chains. 

• June 2026: The system reopens for testing and validation.
• Before 30 December 2026: Every non-SME company under the regulation must be fully registered. Registration cannot be left until the final weeks.

      2.Reporting and Regulatory Convergence

Beyond registration, operators are required to review their due diligence system at least once a year and to retain all records for five years from the date of last placing on the market. Large and medium-sized companies will additionally be required to publish an annual report describing their due diligence activities under Article 12(3). The first reports, covering the year 2027, must be published after 30 December 2027. Companies already reporting under CSRD or CSDDD may integrate this into their existing reporting cycle rather than treating it as a separate obligation.
It is also worth noting that the due diligence system built for EUDR can serve multiple compliance purposes simultaneously.

• The Forced Labour Regulation (FLR), which applies from 14 December 2027, prohibits placing products made with forced labour on the EU market and applies to all economic operators in scope of the EUDR.
• The Corporate Sustainability Due Diligence Directive (CSDDD), which applies from 26 July 2029, establishes a broader horizontal framework for large companies.

Companies building their traceability and due diligence infrastructure for EUDR now are therefore laying the groundwork for both frameworks at the same time.
Sources: 
1.    Report from the Commission to the Council and Parliament on the EUDR (April 2026)
2.    Guidance Document for the Regulation on Deforestation-Free Products (2026)
3.    Frequently Asked Questions - Implementation of the EU Deforestation Regulation (Version 5, April 2026)