Update on Illegal Logging

Update on Australia's Illegal Logging Prohibition legislation (Source: Forestry & Development Newsletter | July 2015)

Australia's Illegal Logging Prohibition Act and associated regulations are still creating uncertainty in timber, pulp and paper markets. The Department of Agriculture has recently stated that although timber importers and processors are obliged to follow the letter of the law, all penalties described in the legislation are on hold until May 2016.

In spite of this temporary respite for importers and processors, the fundamental problems with the legislation remain. The Act shifts onto Australian businesses the cost of policing foreign timber companies to ensure that they comply with foreign laws. Small businesses have assessed the costs of compliance at $340 million per year. If the Department of Agriculture judges (based on highly subjective criteria) that a business has not taken sufficient actions, fines and even imprisonment can result.

Suspension of the penalties until May 2016 will come as welcome news to thousands of processors and importers. However, unless the legislation is amended or withdrawn, the situation will remain unresolved.