ÌìÃÀÓ°Ôº

Report on Council Regulation (EC) No 2173/2005 of 20 December 2005 on the establishment of aÌýFLEGTÌýlicensing scheme for imports of timber into the European Community, as assimilated and amended in UK law

Reporting period: 1 April 2024 to 31 March 2025.

Introduction

1. This report summarises the application of the Forest Law Enforcement Governance and Trade (FLEGT) licensing scheme for the dates 1 April 2024 to 31 March 2025, hereafter referred to as the 2024 to 2025 financial year. It has been prepared in line with Article 8(3) of Council Regulation (EC) No 2173/2005 of 20 December 2005 on the establishment of aÌýFLEGTÌýlicensing scheme for imports of timber into the European Community, as assimilated and amended in UK law, hereafter referred to as the’ÌýFLEGTÌýRegulation’. It is based on information gathered by Defra.

2. This is the fourth report produced by the government on the application of theÌýFLEGTÌýRegulation since the United Kingdom left the European Union (EU).

Voluntary partnership agreements (VPAs)

3. A Voluntary Partnership Agreement (VPA) is a bilateral agreement between a timber- producing country and the UK. VPAs were a key element of the EU FLEGT Action Plan published in 2003. The Action Plan aimed to reduce illegal logging by strengthening the sustainability and legality of forest management, improving forest governance and promoting trade in legally produced timber. TheÌýFLEGTÌýRegulation, adopted by the EU in 2005 and retained and amended under UK law on 31 December 2020, empowers the UK to negotiate VPAs with timber-exporting countries. The UK signed aÌýVPAÌýwith Indonesia on 29 March 2019.

4. VPAs include commitments and actions from both parties to halt trade in illegal timber. Producer countries issueÌýFLEGTÌýlicences that certify the legality of timber exported to the UK. To be able to issueÌýFLEGTÌýlicences, aÌýVPAÌýpartner country must have implemented a timber legality assurance system (TLAS) and other measures specified in theÌýVPA. When fully operational, aÌýTLASÌýincludes effective supply chain controls, mechanisms for verifying compliance and is subject to independent audits. AÌýVPAÌýTLASÌýis built around a practical definition of legality that has been agreed through participatory processes involving stakeholders from government, the private sector and civil society. TheÌýVPAÌýalso promotes better enforcement of forest law and an inclusive approach involving civil society and the private sector.

5. The aim of aÌýVPAÌýis to use trade as an incentive to limit illegal logging. SinceÌýFLEGTÌýlicensed timber automatically meets the requirements of the FLEGT Regulation, UK importers of FLEGTÌýlicensed timber are not required to conduct due diligence on imports. ÌýThis reduces the regulatory burden on UK importers and gives countries exportingÌýFLEGTÌýlicensed timber a market advantage.

6. VPAs also strengthen forest governance in timber-exporting countries by improving transparency, accountability and stakeholder participation. Such gains may result from commitments the partner country makes in theÌýVPAÌýtext and annexes, or from the very process of negotiating and implementing aÌýVPA.

FLEGTÌýregulation enforcement

7. This report is based on data provided by the Office for Product Safety and Standards (OPSS), HMRC and UK Border Force (UKBF) for the 2024 to 2025 financial year. These delivery partners enforce the regulation on behalf of the Secretary of State, who is the Competent Authority for the purposes of the FLEGT Regulation.

HowÌýFLEGTÌýlicensed timber is placed on the market

8. The following section describes howÌýFLEGTÌýlicensed timber is placed on the UK market and explains the role of each enforcement delivery partner in this process. UK importers who wish to import timber and timber products from Indonesia obtain aÌýFLEGTÌýlicence from a supplier. When the shipment is in transit, theÌýFLEGTÌýlicence is submitted toÌýOPSSÌýfor verification. Importers also complete customs forms which are submitted to the HMRC National Clearance Hub (NCH). The NCH matches the customs data with verification fromÌýOPSSÌýbefore the shipment is released for free circulation. UKBF perform physical inspections of shipments where required.

9.ÌýOPSSÌýmaintain retrievable records of applicant and licence details. They also develop, maintain and administer an electronic licencing system through whichÌýFLEGTÌýlicences are processed, records of licences are kept, and the status of checked licences is made available to enforcement partners and importers. They establish the validity of licences and communicate the decision to the end user automatically when no problems are identified and through officer intervention with the end user when problems are encountered.ÌýOPSSÌýcommunicateÌýFLEGTÌýRegulation requirements as widely as possible, including through an up-to-date website. They also respond to those seeking guidance on fulfilling the requirements of the regulation.

10. HMRC are responsible for the customs clearance of goods falling under theÌýFLEGTÌýRegulation. HMRC is also responsible for conducting documentary checks on 10% ofÌýFLEGTÌýShipments. During this process they ensure that a valid licence has been presented which matches the relevant customs declaration prior to releasing the shipment for free circulation. HMRC’s clearance hub works withÌýOPSSÌýon the electronic clearance of licences in line with procedures they agree bilaterally. HMRC are responsible for referring consignments toÌýUKBFÌýfor further investigation when no validÌýFLEGTÌýlicence has been presented. HMRC withhold customs clearance untilÌýUKBFÌýnotify whether the consignment can be released or whether it is going to be seized.

11.ÌýUKBFÌýare responsible for acting on any timber arriving fromÌýVPAÌýcountries without a validÌýFLEGTÌýlicence and responding to specific intelligence about suspected breaches of theÌýFLEGTÌýRegulation involving goods arriving at UK ports, airports or whilst the goods are under customs supervision. They make any required physical inspections of timber shipments presented for release to free circulation without a validÌýFLEGTÌýlicence, including the use of specialist assistance in the identification of species as appropriate.ÌýAs well as detaining or seizing any timber without a validÌýFLEGTÌýlicence,ÌýUKBFÌýdeal with post detention and seizure issues such as requests for restoration, appeals against seizures or non-restoration decisions and arranging for the disposal of seized timber as legally permitted. They refer detectedÌýFLEGTÌýbreaches that fall within agreed criteria to the Border Policing Command of the National Crime Agency for further investigation.ÌýUKBFÌýare required to physically inspect 0.3% of shipments made under aÌýFLEGTÌýlicence.

12. The National Wildlife Crime Unit are the liaison point for any Police activity relating toÌýFLEGT. They are responsible for liaising with other Police units in order to support investigations by other enforcement partners into breaches of theÌýFLEGTÌýRegulation away from the border.

The licence verification process

13.ÌýFLEGTÌýlicences and verification forms are emailed toÌýOPSSÌýwho then perform the following actions:

• check that the licence appears on the Indonesian timber legality verification system (Sistem Verifikasu Legalitas Kayu in Bahasa, or ‘SVLK’) and the status is showing as approved
• check the details that have been provided on the verification form match with the information that has been provided on theÌýFLEGTÌýLicence.ÌýIf there are any discrepancies between the two, or there is information missing,ÌýOPSSÌýemail the sender (usually the importer or the agent) to clarify the discrepancy
• verify the licence on the UKÌýFLEGTÌý IT system -Ìýlicence details are entered into the system including the licence number, country of export, licence expiry date, the date and time that the licence was received, the Harmonized System (HS) Code of the timber or timber products, the volume, weight and number of units included in the shipment, estimated date of arrival of the shipment, method of transport and arrival port or airport
• confirm verification to the importer or agent, HMRC and the licence submitter

Maritime shipments are verified within 2 working days of receipt.ÌýAir shipments must be verified within 4 working hours of receipt.

2024 to 2025 Financial Year – Verification of FLEGT licences and shipments

14. Article 5(4) of theÌýFLEGTÌýRegulation provides for the competent authority to decide on the need for further verification of shipments using a risk-based approach. During the 2024-2025 financial year, OPSS used the following approach.

15. The criteria used to determine whether additional verification of aÌýFLEGTÌýlicence was required included:

• if there was a mismatch of document information
• if theÌýHSÌýcodes mismatched
• if the volume or weight of shipment was mismatched
• if the operator was not the same or if there was a mismatch in the UK and Indonesian Trade Tariff codes

The above checks were carried out byÌýOPSS.

16. The criteria used to determine whether additional verification of aÌýFLEGTÌýlicensed shipment was required included:

• if there was a mismatch inÌýHSÌýcodes
• if there was a mismatch of document information
• random spot checks
• any other issues with theÌýFLEGTÌýlicence

The above checks were carried out by HMRC and UKBF.

17. In the 2024 to 2025 Financial Year a total of 4,824 FLEGTÌýlicences were checked, with 7 licences requiring additional verification.ÌýOPSSÌýrejected 7ÌýFLEGTÌýlicences. UKBF carried out 6 physical inspections over this period.

Penalties

18. Under the Forest Law Enforcement, Governance and Trade Regulations (2012), which implement theÌýFLEGTÌýRegulation in the UK, penalties can be applied if any person discloses information received from HMRC Commissioners if:

(a) the information relates to a person whose identity is specified in the disclosure or can be deduced from the disclosure

(b) the disclosure is for a purpose other than the enforcement of theÌýFLEGTÌýRegulation

(c) the Commissioners have not given their prior consent to the disclosure

19. It is also an offence to:

• intentionally obstruct a wildlife inspector
• without reasonable excuse, fail to give to an inspector any information or assistance that the inspector may reasonably require
• knowingly give false or misleading information to an inspector
• without reasonable excuse, fail to produce a record or document when reasonably required to do so by an inspector

20. A person guilty of any of the above offences is liable on summary conviction to an unlimited fine.

Other sanctions

21. Customs may suspend the release of, or detain, timber products where they have reason to believe that theÌýFLEGTÌýlicence may not be valid in line with Article 5(7) of theÌýFLEGTÌýRegulation. In these cases, costs relating to the holding and subsequent disposal of the timber (including costs of removal, transport, storage, donation, sale or destruction) are recoverable as a debt from the importer.

Licence fee

22. Article 5(6) of theÌýFLEGTÌýRegulations (2012) allows fees to be charged for processingÌýFLEGTÌýlicences. The fee is £9.60 per licence.

FLEGTÌýlicensed timber imports

23. In the 2024 to 2025 financial year more than 135 million kg ofÌýFLEGT-licensed timber and timber products were imported into the UK under valid licences. Due to disclosure restrictions, we are unable to show the breakdown of these imports by commodity code. A full list ofÌýHSÌýcodes included inÌýFLEGTÌýlegislation can be found in Annex A.

Table 1: Top 5 HS4 Codes imported by weight

HS Code	Classification
4802	Uncoated paper and paperboard, of a kind used for writing, printing or other graphic purposes, and non-perforated punchcards and punch-tape paper, in rolls or rectangular (including square) sheets.
4418	Builders’ joinery and carpentry of wood, including cellular wood panels, assembled flooring panels, shingles and shakes.
4412	Plywood, veneered panels and similar laminated wood.
9403	Other furniture and parts thereof.
4803	Toilet or facial tissue stock, towel or napkin stock and similar paper of a kind used for household or sanitary purposes, cellulose wadding and webs of cellulose fibres, whether or not creped, crinkled, embossed, perforated, surface-coloured, surface-deco.

Data source: HMRC Customs Declaration data covering the period April 2024 to February 2025

Annex A: HS product codes

Key to Harmonised System (HS) codes of products imported to the EU in 2017.

HS code	Details
4407	Wood sawn or chipped lengthwise, sliced or peeled, planed, sanded or end- jointed, of a thickness exceeding 6 mm.
4407.25	Wood, tropical; dark red meranti, light red meranti and meranti bakau, sawn or chipped lengthwise, sliced or peeled, whether or not planed, sanded or end-jointed, thicker than 6mm.
4408.90	Sheets for veneering (including those obtained by slicing laminated wood), for plywood or for similar laminated wood and other wood, sawn lengthwise, sliced or peeled, whether or not planed, sanded, spliced or end-jointed, of a thickness not exceeding 6mm.
4409	Wood (including strips and friezes for parquet flooring, not assembled) continuously shaped (tongued, grooved, rebated, chamfered, V-jointed, beaded, moulded, rounded or the like) along any of its edges, ends or faces, whether or not planed, sanded or end-jointed.
4409.22	Wood; tropical (including unassembled strips and friezes for parquet flooring), continuously shaped along any edges, ends or faces, whether or not planed, sanded or end-jointed.
4409.29	Wood (including strips and friezes for parquet flooring, not assembled) continuously shaped (tongued, grooved, rebated, chamfered, V jointed, beaded, moulded, rounded or the like) along any of its edges, ends or faces, whether or not planed, sanded or end jointed, non-coniferous (not from rattan).
4412	Plywood, veneered panels and similar laminated wood.
4412.31	Plywood; consisting only of sheets of wood (not bamboo), each ply 6mm or thinner, with at least one outer ply of tropical wood.
4412.94	Blockboard, laminboard and battenboard (not bamboo, and other than plywood consisting only of sheets of wood each ply 6mm or thinner).
4414	Wooden frames for paintings, photographs, mirrors or similar objects (not from bamboo nor rattan).
4418	Builders’ joinery and carpentry of wood, including cellular wood panels, assembled flooring panels, shingles and shakes.
4418.20	Wood; doors and their frames and thresholds.
4418.99	Wood; builders’ joinery and carpentry of wood n.e.c. in heading no. 4418, other than of bamboo.
4421	Wooden articles n.e.c. in heading no. 4414 to 4420.
4421.99	Wood; not of bamboo, articles n.e.c. in heading no. 4414 to 4420 (excluding clothes hangers).
4703	Chemical wood pulp, soda or sulphate, other than dissolving grades.
4802	Uncoated paper and paperboard, of a kind used for writing, printing or other graphic purposes, and punch card stock and punch tape paper, in rolls or sheets, other than paper of heading No 4801 or 4803; handmade paper and paperboard.
4802.56	Uncoated paper and paperboard (not 4801 or 4803); printing, writing or graphic, 10% or less by weight of mechanical or chemi-mechanical processed fibre, weight 40-150g/m2, in sheets 435mm or less by 297mm or less (unfolded).
4803	Tissue, towel, napkin stock or similar; for household or sanitary uses, cellulose wadding, webs of cellulose fibres, in rolls over 36cm in width or rectangular sheets with one side exceeding 36cm when unfolded.
4804	Uncoated kraft paper and paperboard, in rolls or sheets, other than that of heading no. 4802 or 4803.
4810	Paper and paperboard, coated on one or both sides with kaolin (China clay) or other inorganic substances, with or without binder, and with no other coating, whether or not surface-coloured, surface-decorated or printed, in rolls or rectangular (including square) sheets, of any size (not from non-wooden nor recycled material).
4821	Paper or paperboard labels of all kinds, whether or not printed.
9401	Seats (other than those of heading 94.02), whether or not convertible into beds, and parts thereof.
9401.69	Seats; with wooden frames, not upholstered, (excluding medical, surgical, dental, veterinary or barber furniture).
9403	Other furniture and parts thereof.
9403.60	Furniture; wooden, other than for office, kitchen or bedroom use.