Navigating the EU Deforestation Regulation (EUDR) for Vietnamese Exporters and European Importers
As the EU Deforestation Regulation (EUDR) takes effect, both Vietnamese exporters and European importers enter a new era of accountability. From coffee and rubber to furniture and leather goods, the EUDR reshapes how companies prove legality, traceability, and sustainability across their supply chains.
Vietnam, one of Asia’s most dynamic manufacturing and sourcing hubs, is well positioned to meet these new standards thanks to its existing forest governance frameworks such as FLEGT (Forest Law Enforcement, Governance and Trade), VPA (Voluntary Partnership Agreement) and VNTLAS (Vietnam Timber Legality Assurance System). These systems already emphasize legality verification and sustainable wood sourcing. However, many companies, both in Vietnam and in Europe, still misunderstand what EUDR compliance really means.
This article clarifies the key misconceptions about the EUDR among Vietnamese exporters while outlining practical steps for European buyers to verify supplier compliance. Together, these insights highlight how businesses can transform regulation into opportunity and strengthen their position in the global sustainable trade landscape.
Understanding the Scope of the EUDR
A common misunderstanding is that the EUDR only applies to agricultural crops such as coffee, cocoa, or palm oil. In reality, the regulation covers seven core commodities: coffee, cocoa, palm oil, soy, timber, rubber, and cattle; along with all derived and processed products made from these materials.
This broad scope means that Vietnam’s furniture, footwear, leather, and processed food industries are also directly affected. For example:
A furniture exporter must provide geolocation data proving the timber’s legal and deforestation-free origin.
A leather goods manufacturer must trace the cattle hides used, even if those hides were imported from another country before processing in Vietnam.
Unlike previous sustainability standards, the EUDR extends throughout the entire supply chain, not just to raw materials. It requires traceability from the farm or forest of origin to the final product placed on the EU market.
This marks a fundamental shift: compliance is no longer about broad sustainability commitments but about verifiable data points that prove where and how materials were produced.
Why This Matters for Vietnam
Vietnam’s export portfolio is highly exposed to EUDR coverage. According to 2024 trade data:
The EU accounts for nearly 15% of Vietnam’s coffee exports,
10% of rubber exports, and
Over 1.5 billion USD in wood and furniture exports annually.
With such exposure, ensuring compliance is essential not only for continued EU market access but also for maintaining global competitiveness.
White Paper: EU Deforestation Regulation (EUDR): Overview and Implications for Vietnam
To support exporters, manufacturers, and European importers in navigating the new regulation, SAV and FVSource have jointly released the White Paper on the EU Deforestation Regulation (EUDR). This publication provides an in-depth analysis of how the EUDR will affect Vietnam’s key export sectors; including furniture, coffee, rubber, leather, and agricultural products; and outlines practical strategies for compliance.
Inside the White Paper, readers will find:
A breakdown of EUDR legal requirements and due diligence obligations;
A country risk assessment highlighting Vietnam’s readiness and advantages;
Case studies of early adopters who have implemented traceability and geolocation systems;
Step-by-step guidance for both exporters and European buyers to align with the new standards.
This White Paper serves as a roadmap for businesses aiming to maintain market access and strengthen their sustainability credentials under the EUDR framework. Click HERE to download.
Shared Responsibility: Exporters and Importers Must Work Together
Another widespread myth is that EUDR compliance is solely the responsibility of European importers. While EU-based companies must submit due diligence statements to European authorities, they depend heavily on their suppliers in countries like Vietnam to provide the required data.
Under the regulation, importers must demonstrate that:
The products are deforestation-free,
They were legally produced under local laws, and
The company has conducted adequate due diligence before placing the goods on the EU market.
To meet these criteria, EU buyers require detailed information from suppliers—such as polygon geolocation coordinates, traceability documentation, and evidence of legality. Without this data, importers cannot legally sell the products in Europe.
In short, EUDR compliance is a shared responsibility:
Vietnamese exporters must ensure transparency and provide accurate, verified data.
European buyers must assess, document, and retain evidence of compliance during audits.
This interdependence creates new opportunities for collaboration. By developing clear data-sharing protocols, exporters and buyers can reduce risk, streamline operations, and strengthen long-term partnerships.
Certifications Help But They Are Not Enough
Many exporters assume that having sustainability certifications such as FSC, Rainforest Alliance, or ISO 14001 automatically fulfills EUDR requirements. Unfortunately, this is not the case.
The EUDR is data-driven, not label-driven. It demands verifiable geolocation data proving that the production area was not deforested after 31 December 2020, along with evidence that all activities comply with national laws on land use, labor, and environmental management.
A company may hold FSC certification but still lack precise mapping of its raw-material origins—an essential requirement under the new regulation.
To bridge this gap, exporters should:
Combine certification with digital mapping and traceability systems,
Integrate certification audits into broader EUDR data verification, and
Leverage Vietnam’s VNTLAS framework as a legal baseline, especially in the timber and furniture sectors.
For buyers, certifications remain valuable supporting evidence, but they should be treated as complements, not substitutes, for traceability and legality data.
Risk Management and Country Classification
A common fear among exporters is that a single missing document could cause an immediate shipment rejection. In practice, the EUDR applies a risk-based approach to compliance.
Countries will be classified into low-risk, standard-risk, or high-risk categories based on their deforestation rates, governance, and data transparency.
Vietnam is expected to fall into the low-risk category thanks to its strong forest protection policies, FLEGT-VPA implementation, and low deforestation levels compared to regional peers.
What “Low Risk” Means
Being in a low-risk category means that:
Customs checks and document reviews will be less frequent.
Importers may benefit from simplified due diligence processes.
Vietnam’s exporters gain a reputational advantage over suppliers in higher-risk regions.
However, low risk does not mean no risk. Authorities in the EU will still conduct random audits, and penalties for non-compliance can include fines, trade restrictions, or product removal from the market.
To maintain this advantage, Vietnamese exporters must continue demonstrating transparency and cooperate fully with buyer requests for documentation.
What about “high-risk” countries ?
While Vietnam benefits from a low-risk classification, some countries are considered high-risk due to high deforestation rates or weak governance. Examples include Brazil, Indonesia, Malaysia, and the Democratic Republic of Congo.
For exporters in these regions, the EUDR imposes stricter due diligence, more frequent customs checks, and higher compliance costs. European buyers often require detailed geolocation data, on-site verification, or third-party audits before goods can enter the EU market.
This contrast highlights Vietnam’s advantage: as a low-risk country with robust traceability systems, Vietnamese exporters can offer more predictable, compliant, and efficient supply chains, an increasingly valuable proposition for EU importers.
Turning Compliance Into Competitive Advantage
At first glance, EUDR compliance may seem like a costly administrative burden, requiring digital mapping, data verification, and extra paperwork. Yet for forward-looking exporters, it represents a strategic business opportunity.
European brands and retailers are under increasing pressure from consumers and regulators to ensure that their supply chains are deforestation-free and ethically sourced. Suppliers capable of providing complete traceability data will be more attractive partners.
Vietnamese companies that invest early in compliance are already seeing tangible rewards. In sectors like rubber and coffee, compliant exporters have achieved price premiums of USD 150–300 per ton compared to non-compliant competitors.
Building Long-Term Trust
For exporters, EUDR alignment can unlock deeper, more stable relationships with EU clients. Buyers who trust their suppliers’ data are less likely to switch vendors, leading to stronger, longer-term contracts.
Moreover, as sustainability becomes a global expectation, not just an EU requirement, companies that master EUDR standards will find it easier to comply with upcoming U.S. and UK deforestation laws, further expanding their market access.
Practical Steps for Vietnamese Exporters
Aligning with the EUDR is not just about compliance, it’s about taking proactive steps to secure long-term business opportunities.
Vietnamese exporters who act early can streamline processes, reduce audit risks, and position themselves as preferred partners for European buyers.
How Vietnamese Exporters Can Prepare
The path to compliance may appear complex, but Vietnamese companies can take several concrete steps to prepare effectively.
a. Build Digital Traceability Systems
Traceability begins with data. Exporters should work with local authorities, cooperatives, or technology providers to map farms, plantations, or forest plots using GPS or polygon coordinates. Modern digital platforms can help collect, verify, and share this information securely with EU partners.
b. Participate in National Pilot Programs
The Ministry of Agriculture and Rural Development (MARD) is conducting traceability pilots in coffee, rubber, and timber sectors. Joining these programs not only prepares companies for compliance but also connects them with support networks and EU-funded capacity-building initiatives.
c. Collaborate Proactively with EU Buyers
Instead of waiting for buyers to request data, exporters should share traceability documentation early in the process. Aligning with buyer templates and due diligence formats saves time and avoids last-minute issues during customs clearance.
d. Strengthen Internal Documentation
Ensure that all production and export documents, land-use rights, licenses, tax records, and material inputs, are organized and easily accessible. Inconsistent records are one of the most common causes of delays during audits.
e. Stay Informed
Regulatory guidance and country-risk classifications may evolve. Businesses should stay up to date with information from MARD, the EU Delegation in Vietnam, and trusted sourcing consultancies like FVSource or MoveToAsia, which provide EUDR updates and sector analyses.
By integrating these actions, exporters not only achieve compliance but also strengthen their operational efficiency and global reputation.
How European Buyers Can Ensure Supplier Compliance
European importers sourcing from Vietnam also play a vital role. To safeguard their market access, they must follow a structured due diligence framework.
Step 1. Request Detailed Traceability Data
Buyers should request polygon geolocation data showing the exact farms, forests, or plantations of origin. The goal is to prove that the land was not linked to deforestation after the 2020 cutoff date.
Vietnam’s MARD is expanding digital mapping systems for coffee, rubber, and timber—buyers should prioritize suppliers that participate in these official programs.
Step 2. Verify Legal Production
The EUDR requires proof of legality under national laws. Importers should review supplier licenses, land-use rights, and tax documentation. For timber and furniture products, Vietnam’s VNTLAS system provides a reliable basis for legal verification.
Step 3. Treat Certification as Supporting Evidence
Certifications such as FSC or Rainforest Alliance should be viewed as complementary, not conclusive. Combine them with geolocation and legality verification to build a robust due diligence file.
Step 4. Include EUDR Clauses in Supply Contracts
Contracts should define clear responsibilities for data submission, audit cooperation, and transparency obligations. This ensures accountability on both sides and reduces compliance disputes later on.
Step 5. Conduct Supplier Risk Assessments
Even in a low-risk country, risk can vary by supplier. Buyers should evaluate whether their partners:
Create shared folders or digital dashboards where suppliers can upload traceability and legality data. This makes compliance easier to monitor and reduces time spent preparing due diligence statements.
Step 7. Offer Training and Continuous Improvement
Compliance is not static, it evolves. Buyers should consider co-funding workshops or training sessions that help suppliers understand new EUDR requirements, technology tools, and documentation standards.
Vietnam’s Readiness and the Road Ahead
Vietnam’s combination of strong governance, industry collaboration, and digital innovation makes it one of Asia’s most EUDR-ready sourcing destinations.
Institutional Strength
The FLEGT-VPA (Forest Law Enforcement, Governance and Trade – Voluntary Partnership Agreement) and VNTLAS (Vietnam Timber Legality Assurance System) have already built a foundation for legality verification. These systems help exporters demonstrate that wood and derived products comply with both Vietnamese law and EU market expectations.
Digital Transformation in Traceability
Vietnam’s agricultural and forestry sectors are rapidly adopting digital traceability platforms, often with EU and international support. Projects like Sustainable Coffee Landscape (GIZ) and Circular Cocoa are helping smallholders map production areas, record supply-chain data, and share this information with buyers in real time.
Private Sector Momentum
Major Vietnamese exporters, particularly in furniture, coffee, and rubber, are investing in in-house sustainability departments and data systems. Some have integrated satellite monitoring and blockchain-based traceability to track materials from plantation to shipment.
Opportunities for Collaboration
For European buyers, this progress means that working with Vietnamese suppliers offers significant advantages:
Lower compliance risks due to established governance systems.
Reduced administrative burden as digital mapping becomes standardized.
Access to verified, deforestation-free materials across diverse product categories.
As EUDR enforcement tightens over 2025–2026, Vietnam’s proactive approach could position it as a regional leader in sustainable sourcing.
Challenges Ahead: What Still Needs Work
Despite progress, some challenges remain before full-scale compliance can be achieved.
Data Fragmentation
Smallholder farmers, especially in coffee and rubber sectors, often operate outside digital systems. Ensuring their inclusion in traceability databases is vital for full transparency.
Capacity and Cost
Building and maintaining digital mapping systems requires training and investment. SMEs may struggle with resource limitations, highlighting the need for shared platforms or government-backed tools.
Coordination Across Supply Chains
Many export products involve complex, multi-tier supply chains. Establishing clear communication between farmers, traders, processors, and exporters remains a key challenge that both the government and industry associations are addressing through pilot projects.
Looking Forward: Turning Regulation Into Opportunity
The EUDR signals a global shift. Similar regulations are being considered in the United States, the United Kingdom, and Japan, meaning deforestation-free trade is becoming the new global norm.
By adapting early, Vietnamese exporters and their European partners can gain first-mover advantages, access to new buyers, premium markets, and reputational benefits that go beyond compliance.
The next two years (2025–2026) will be crucial. Companies that invest now in traceability technology, staff training, and transparent supplier relationships will not only comply with the EUDR but will set the benchmark for responsible trade in Asia.
Conclusion
The EU Deforestation Regulation (EUDR) is more than a compliance hurdle, it represents a turning point for how global trade operates.
For Vietnamese exporters, success depends on understanding the regulation’s real requirements, dispelling myths, and investing in traceability systems that demonstrate legality and sustainability.
For European buyers, success lies in building collaborative partnerships, implementing structured due diligence, and supporting supplier capacity building.
Vietnam’s strong governance, expanding digital traceability initiatives, and expected low-risk classification make it one of the most promising sourcing destinations under the EUDR framework.
Early adopters, on both sides, will gain a clear competitive edge in the future of sustainable, transparent, and deforestation-free trade.
