EUDR: Understanding the Due Diligence System and Due Diligence Statement
As EUDR deadlines approach, understanding the role of the Due Diligence System and Statement becomes essential.
As the EU Deforestation Regulation (EUDR) moves closer to full application, businesses trading in affected commodities are entering a new phase of compliance. This is no longer about collecting documents when needed. It requires structured processes, clear ownership, and data that can stand up to scrutiny.
At the centre of this regulation are two closely linked concepts: the Due Diligence System and the Due Diligence Statement. Understanding how they differ, and how they work together, is essential for any business placing or trading in-scope goods on the EU market.
When Does EUDR Apply?
The regulation entered into force on 29 June 2023, setting the legal foundation for deforestation-free supply chains. It applies to a defined set of commodities and their derived products, including cattle (and beef), cocoa, coffee, palm oil, soy, rubber, and wood, covering both imports into and exports from the EU market.
The operational requirements are phased in. From 30 December 2026, large and medium-sized companies must comply with the regulation. Smaller businesses are given additional time, with obligations applying from 30 June 2027.
While these dates may seem distant, the reality is different. The level of data required, combined with the need for internal alignment across functions, means preparation needs to start well in advance.
What is a Due Diligence System?
A Due Diligence System is the internal structure that allows a company to manage EUDR compliance. It is not simply a tool or a database. It is a compliance framework that ensures the right information is collected, assessed and acted upon in a consistent way.
Under the regulation, operators and larger traders must apply due diligence to all relevant products and suppliers. This applies across the entire supply chain, not just at the point of import. In practice, the system revolves around three interconnected steps.
First, companies must collect the right information. This includes details such as geolocation data, quantities, country of production and supporting supplier documentation. The purpose is to demonstrate that the product is both deforestation-free and legally produced.
Second, that information must be assessed. Businesses need to determine whether there is any risk that the product does not comply with the regulation. This assessment must be structured and explainable. It should be clear how the data was verified, which criteria were applied and how the conclusion was reached.
Third, where a risk is identified, action must be taken. Risk mitigation is not optional. Companies are expected to take proportionate measures to reduce any identified risk to a negligible level. This may involve additional supplier engagement, changes in sourcing or strengthening internal controls.
For companies sourcing exclusively from low-risk countries, a simplified approach may apply. However, this does not remove responsibility. It reduces the level of checks, but not the need for a functioning system.
What is a Due Diligence Statement?
Where the Due Diligence System sits internally, the Due Diligence Statement is the external confirmation that the process has been carried out. It is a formal declaration that the required due diligence has been completed and that the product complies with EUDR requirements. This statement must be submitted for every shipment.
Each statement generates a reference number, which becomes a critical part of the transaction. It must be included in documentation and passed along the supply chain. Without it, customs clearance for EUDR goods will not proceed. In addition, companies are required to retain their risk assessments and supporting evidence for a minimum of five years, ensuring that compliance can be demonstrated if requested by authorities.
The Role of the EU Registry
All Due Diligence Statements must be submitted electronically through the EU’s central registry. This platform standardizes how statements are created and submitted, while also allowing authorities to verify compliance.
Companies that are subject to the regulation must register in this system. This includes operators, traders and, where applicable, authorised representatives acting on their behalf.
The registry is more than an administrative tool. It acts as a central control point where data, compliance and enforcement come together.
Understanding the Difference
A practical way to distinguish the two is to look at their role in the process. The Due Diligence System is the internal engine. It ensures that your data is complete, your assessments are structured and your risks are managed.
The Due Diligence Statement is the output. It confirms, for each individual shipment, that the process has been followed and that the product meets the requirements. One cannot function without the other. Without a system, the statement has no foundation. Without the statement, the system has no external validity.
What This Means for Your Business
EUDR changes the role of compliance within your organisation. It moves from a periodic activity to a continuous process that is directly linked to your supply chain data. The quality of your information becomes critical. If data is incomplete or inconsistent at source, that risk does not stay isolated. It scales with every shipment.
At the same time, responsibility becomes more clearly defined. Authorities expect transparency around decisions, traceability across the supply chain and consistency in how risks are assessed and managed.
Preparing for Implementation
The companies that are best positioned for EUDR are those that start early. Preparation is not about ticking boxes just before the deadline. It is about building a structure that can handle ongoing requirements at scale.
Recent research conducted by Customs Support Group shows that many businesses are still in the process of preparing for EUDR compliance.
To move from preparation to compliance, businesses need clear visibility across their supply chain and internal processes.
This means understanding where your products originate, validating supplier data, and ensuring that your internal processes are aligned across procurement, compliance and operations.
It also means being ready to produce accurate Due Diligence Statements for every shipment without disrupting your flow of goods.
How Customs Support Group can Help
Customs Support Group works with businesses to translate regulatory requirements into practical, operational processes. In the context of EUDR, this means helping you build a Due Diligence System that works in practice, not just on paper.
From structuring your data flows to supporting the submission of Due Diligence Statements, the focus is on creating a setup that is consistent, scalable and ready for audit. Speak to our experts to assess your current readiness and next steps.
