First UK business fined for breaching EU Timber Regulation

Designer furniture retailer Lombok has become the first UK business to be fined for breaching the EU Timber Regulation (EUTR).

The EUTR came into force in the UK on 3 March 2013 and prohibits the placing of illegally harvested timber on the EU market. It lays down the procedures which those trading timber or timber products (including joinery) within the EU must put in place to minimise the risk of illegal timber being sold.

Angora 2011 Limited, trading as Lombok, was convicted and fined after pleading guilty to breaching the regulation at a hearing at Westminster Magistrates Court on 25th October. The fine was £5,000, plus a victim surcharge of £170 and prosecution costs of £2,951.

The company failed to exercise the required due diligence when placing an artisan sideboard from India on the market, having previously failed to ensure that items it had sourced from India were made out of wood from legal logging sites.

In October 2016, enforcement officers visited Lombok’s central London showroom and found the company had again not made checks on a type of imported artisan sideboard it was selling. The prosecution was brought by the Insolvency Service Criminal Enforcement Team on behalf of the BEIS Regulatory Delivery team.

First UK business fined for breaching EU Timber RegulationBWF Policy & Communications Executive Matt Mahony commented on the news:

“As a renewable material, the use of timber and timber products can help foster biodiversity and mitigate climate change. Legal and responsible sourcing of material is a crucial element of this and is carried out in the UK in the vast majority of instances.

“Companies that undermine public confidence in the legality of timber through gross complacency or simply ignoring the rules about bringing products into the EU from areas at risk deserve to take a hit. With all the great work that has been carried out to bring sustainable timber into the UK it is simply too important to get this wrong.”

Julia Young, global forest and trade network manager for WWF-UK, said,

“Companies must invest in the forests that they rely on, rather than exploit them,”

“It is surprising that Lombok ignored the warnings from the enforcement agency to take action, and it is the right outcome that they have been penalised for ignoring the law."

Although they are the first UK business, Lombok are not the first company to fall foul of the EU Timber Regulation as two Member State authorities are known to have issued fines. Last year a court ruling in Sweden declared that a company importing timber from Myanmar was in breach of the EUTR because the origin of the timber could not be accurately determined. Fines have also been imposed in The Netherlands where a company did not meet the EUTR due diligence requirement.

Most UK joinery businesses will find that the transactions they made were already compliant with the EUTR. This is because companies trading in timber and timber products within the EU must essentially just keep records of sale and purchase. Their obligations under Article 5 of the Regulation concern traceability and are as follows:

1. To identify the operators or the traders who have supplied the timber and timber products.

2. To identify, where applicable, the traders to whom you have supplied timber and timber products.

3. To keep this information for at least five years and provide it to competent authorities if they so request.

Companies bringing timber products in directly from outside the EU have found compliance more complex. They needed to have a due diligence system in place even for one-off transactions and could not rely on suppliers to carry this out on their behalf. The system had to include information about the supply of timber products, an evaluation of the risk of placing illegally harvested timber and timber products on the market and necessary steps to mitigate this risk; for example additional information and third party verification.

Here you can find out more about what joinery manufacturers need to do to meet the EU Timber Regulation and how easy it has been.

BWF has guidance, FAQs and a template due diligence system that member joinery companies can use to stay on top of the rules.