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24 June 2008

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US Lacey Act

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Updated Lacey Act becomes worlds first ban on illegal logging

Washington DC, USA ' Importers of wood products may want to keep an eye on newly passed regulations in last months farm bill. New amendments added to the Lacey Act aim to cut down on illegal logging.

Depending on how strongly the new provisions are enforced, the law could have implications for the furniture industrys supply chain.

The legislation creates a requirement for importers to declare the species and country of origin of any plant or plant product, including wood.

Penalties range from $250 to in excess of $500,000 with a possibility of jail sentence for knowingly sourcing, or failing to exercise due care when sourcing, products that contain illegal timber or plants.

Illegally logged wood is often defined as wood that is sold below market price or wood cut in violation of treaties, laws and regulations.

The amendments added by this years farm bill to the Lacey Act are intended to protect forests worldwide from deforestation and illegal wood products from entering the United States.

The Lacey Act, originally signed into law in 1900, is a conservation law that focuses on illegal commercial transportation of wildlife and non-native species.

The new farm bill extended provisions to amendments added to the act in 1981 to address global illegal logging and trade.

The key to the Lacey Act amendment is to provide a level playing field for U.S. forest products manufacturers, said Tom Inman, president of the Appalachian Hardwood Manufacturers Assn.

There have been companies in recent years trading in illegal forest products, and estimates are that $460 million was lost last year in U.S. export sales because of illegally harvested wood.

Just what percentage of logging is done illegally remains unknown, but estimates peg the level at 10% or higher.

Typically, illegal logs and lumber are purchased by factories for one-half the cost of legally harvested and documented wood products.

Officials with the Environmental Investigation Agency, a non-profit Washington- and United Kingdom-based environmental watchdog group, said that failure to adhere to the provisions would increase risk of seizure and forfeiture of products made with illegally sourced wood.

Import requirements havent been issued yet but are likely to come out in the next six months, said David Groves, a spokesperson for EIA.

The bill will be jointly enforced by U.S. Customs and Border Protection, the U.S. Fish and Wildlife Service and the Animal Plant Health Inspection Service.

The process of creating an interagency task force to help facilitate information flow and appropriations is still being worked on, Groves said.

Once the law is finalized, the U.S. Department of Justice is likely to look at importers and choose to try the cases they are most likely to win.

Groves said the law doesnt state requirements for how importers should show that wood is legally harvested, so no third-party certification is required.

That will leave importers with the responsibility of deciding if their products come from reputable wood sources.

For retailers and importers, the law has a flexible due care concept, which could cause larger importers to be held to a higher standard than smaller independent purchasers. Countries with a higher record of illegal logging could also be more closely targeted by the enforcement community than countries with stricter logging laws, Groves said.

For example, big-box retailers could be expected to send groups to talk to long-term suppliers in source counties to make sure their wood is sourced responsibly, rather than relying strictly on paperwork.

A mom-and-pop shop isnt going to be expected to go overseas, Groves said. The main purpose of the declarations is to provide the most basic information to the enforcement community. If teak is coming from China, there was good chance it was cut in Burma and is illegally funding the junta.

With the passing of the law, the U.S. became the first country in the world to prohibit the import, sale or trade of illegally harvested wood and wood products.

Groves added that the new law is more stringent that the European Unions voluntary Action Plan for Forest Law Enforcement Governance and Trade, which targets countries that contain nearly 60% of the worlds forests, namely Central Africa, Russia, Tropical South America and Southeast Asia.

The U.S. has leapfrogged and taken the most significant steps toward addressing illegal logging, Groves said.

The EIA is most concerned about wood sourced from the following regions:

The Russian Far East, primarily the Primorky Region, which hangs over Far Eastern China and extends through Suifenhe City in the Heilongjiang province.

Russian timber moving through Manzhouli in the Inner Mongolia Autonomous Region of China.

Exotic species from Indonesia, specifically grown in areas such as Papua, New Guinea.

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Assessing illegal logging

Chatham House is assessing the scale and effectiveness of the response to illegal logging and the related trade around the world. Full details of this work, including analysis and data, will be available online soon.