EUDR Regulations for Natural Rubber_290824

Basics of EUDR

1. EU DEFORESTATION REGULATION Legal Perspective

2. WHAT IS EUDR ? Ensure specified products/ raw materials supplied to EU markets are Deforestation-free Rubber is one of such specified raw material Tyre is one of such specified product(s) All participants in supply chain covered Timelines for EU Commission: 30 Dec, 2023: Providing Contact details of competent authorities 30 Dec, 2024: Publishing of Country-wise assessment list 30 Dec, 2024: Go live of e-system for registration and submission of information 30 Jun, 2025: Re-assessing addition/ deletion of country list 30 Jun, 2028: Operationalising e-Interface for Custom authorities Transition cut-off date for compliance to EUDR : 30 Dec, 2024

3. WHAT IS REQUIRED? Ensure specified product(s)/ raw material is Deforestation-free; Adhere to Local regulations File Due Diligence Statement* in respect of the specified product(s)/ raw material What is Deforestation-Free ? The raw material, used for production or otherwise, is produced on land which has not been deforested after 31 Dec, 2020. Deforestation means “ Conversion of Forest to agricultural use , whether human induced or not. ” (This implies coverage of use of forest land damaged by natural factors like forest fire for agriculture as well as using forest land for agricultural plantations.) *Due Diligence Statement format and contents yet to be notified

4. WHO IS COVERED ? Theoretically, entire Supply-Chain is covered; Practically, Only finished product manufacturers / Supplier groups will be covered ; Last mile Rubber Producer identification will be very difficult & hence geo-tagging may be conducted through Supplier Groups only. Initially, all countries will have Standard Risk Through specific list, EU will specify Low/ High Risk countries (on/ before 30 Dec, 2024 ); Through representations from countries, list may be modified; Procurement from H igh Risk countries either to be stopped or subjected to stricter controls.

5. OTHER REQUIREMENTS* Identify Authorised representatives for submitting Due Diligence Statement Retain Records for 5 years Develop e-system for management of Due Diligence Statements Conduct atleast one Audit every year Publish the details on efficacy of due-diligence system (Existing CSRD/ ESRS # may be considered by EU) * This is the standard requirement which may reduce if sourcing country falls under “Low” Risk category. # CSRD: Corporate Sustainability Reporting Directive; ESRS : European Union Sustainability Reporting Standards

6. NON-COMPLIANCE COST Corrective action by Defaulter: Rectify formal non-compliance; Preventing sale of non-compliant goods; Withdrawing / recalling non-compliant goods immediately; Donating the goods to charity or dispose of as waste. Penalty (may be imposed) Fine proportionate to environment damage and value of goods (Max. 4% of EU Turnover ) ; Confiscation of goods or revenue gained from single transaction ; 12-month temporary ban from public procurement ; Temporary ban on sale . STOP

7. Ensure Rubber is not sourced from deforested land in respect of: Tyres manufactured in Europe ; Tyres manufactured outside of Europe but sold in Europe (including 2-wheeler tyres as well as Inter-Company transfers) ; Rubber imported in Europe in raw form or otherwise. Also, Ensure complete traceability of Rubber through Due Diligence Statements; Revise Rubber procurement policy ; Deploy Independent audit for reviewing activities. WHAT IT MEANS FOR US?

8. THANK YOU