INDONESIAN SVLK TIMBER MAY ENTER EU WITHOUT INSPECTION

The EU has stated that it is poised to fully implement a Voluntary Partnership Agreement (VPA) on forest law enforcement, governance and trade (FLEGT) with Indonesia. The move would mean that all Indonesian SVLK timber products could enter the EU market without inspection. EU Ambassador to Indonesia Vincent Guerend promised that his party would fully implement the agreement on April 1, 2016. The FLEGT implementation, he said, would benefit Indonesia, which currently has a 40-percent market share in the EU tropical timber market. However, he said that timber products must have the required V-legal documents attached, as regulated by Indonesia’s Timber Legality Verification System (SVLK).
As V-legal documents would be considered equal to a FLEGT license, Indonesian timber would automatically pass the due-diligence examination that is usually required before products enter the EU market. Commenting on Indonesia’s plan to exempt furniture products from V-legal documentation as cited in Trade Ministerial Regulation No. 89/2015, Guerend said it would be the government’s job to ensure all products came complete with V-legal documents and were from sustainable sources.

A NEW CHAPTER TO THE INDONESIA EU FLEGT-VPA SOAP

Both Indonesia and the EU have restated their stances on timber legality certification, with the latter insisting that their voluntary partnership on forest law enforcement governance and trade (FLEGT-VPA) will go nowhere unless the Indonesian government revives “green certification” requirements for all timber products. EU Ambassador to Indonesia Vincent Guérend said on 23 November last that the EU was ready to implement the FLEGT-VPA in April next year as long as Indonesia applied its timber legality verification system (SVLK) to all of its timber products — both upstream and downstream. Once the FLEGT-VPA between the two countries is fully operational, Indonesia’s SVLK-certified timber products will no longer need to go through due diligence processes as they will be acknowledged to be in full compliance with the bloc’s timber regulations. “The last trade regulation exempts 15 products of wood furniture [from SVLK], and this is not in compliance [with FLEGT-VPA] [...] So, Apr. 1 is the common objective, but firstly the last exemptions have to be removed,” he said after a discussion held by the Multistakeholder Forestry Programme (MFP). Guérend was referring to the Trade Ministry’s revised Regulation No. 97/2014 to Regulation No. 89/2015, which allows exports of as many as 15 downstream timber products without SVLK, also known as V-legal, certificates.

Exporters need only to show proof that their products’ raw materials are sourced from suppliers with V-legal documents, the new revised regulation stipulates. Guérend said the SVLK had been recognized by both European businesses and consumers, with 40 percent of the EU’s tropical wood imports coming from Indonesia. While having no official position on the SVLK, the US Embassy to Indonesia’s deputy chief of mission, Brian McFeeters, said that all American wood importers had to show that their imports were legally based in their countries of origin, as required by the US’ 2008 Lacey Act.

“It’s not that we discriminate [with products]. We just want to provide ease of business for our downstream industry.” McFeeters said the SVLK had become a tool to help Indonesian timber exporters in complying with American laws. He estimated that wood imports from Indonesia to the US amounted to as much as US$284 million last year. Trade Ministry director for exports of agriculture and forestry products Nurlaila Nur Muhammad, said, meanwhile, that the revised regulation was aimed at boosting the local downstream industry, including small and medium-sized furniture exporters. “It’s not that we discriminate [with products]. We just want to provide ease of business for our downstream industry,” she said, adding that furniture and woodcraft exports were expected to hit $5 billion in 2019. She said the revised regulation would still oblige the upstream timber industry to obtain V-legal certificates.
Separately, business players expressed different opinions on the revised regulation. Indonesian Furniture Entrepreneurs Association (Asmindo) vice chairman Rudy T. Luwia said the exemption of 15 timber products from V-legal certification would not effectively address timber export problems as the core problem lay with the availability of raw materials. Barian Tio, a sales representative from local furniture exporter Rimba Central Management Group, said, however, that the SVLK had become an additional cost for his company as it had to spend Rp 40 million ($2,915.5) a year on the certification. “Not to mention that we also need to acquire more globally recognized legality certifications from the Tropical Forest Trust [TFT] and the Sustainable Forestry Initiative (SFI) to secure our markets, such as the US and Japan,” he said.

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