New EU Regulation Set to Ban Imports of Non-Sustainable Chocolate and Other Raw Materials by 2025

A new regulation from the EU has been put in place, set to take effect from 2025. This regulation states that only chocolate that has not contributed to deforestation and has not involved child labor in its production will be allowed to be imported. The rule covers all raw materials like wood, rubber, soy, coffee, palm oil, and beef. Companies will have to conduct due diligence in their supply chains to ensure compliance with the regulation. Failure to comply may result in penalties and product bans.

The EU is a significant consumer of goods leading to deforestation but not a major producer. The regulation is likely to impact growing regions like Brazil and Indonesia where deforestation for products such as beef, coffee, soy, and palm oil may decrease. However, companies upgrading their supply chains to meet the regulation’s standards are expected to increase costs which could lead to increased prices for chocolate, coffee, and palm oil being passed on to consumers. Despite the potential economic impact, the regulation is expected to have a minor effect on overall prosperity.

The rule aims to improve sustainability in the supply chain by setting new standards for producing countries. With proper enforcement, it is anticipated that the regulation will minimize the negative impact on economic output and lead to relatively small losses in prosperity. The deforestation regulation covers not just cocoa or chocolate products but also other raw materials like wood, rubber