Danish regulator questions sale of Myanmar teak

The Danish Competent Authority last week required seven companies to make improvements to their due diligence systems if they are to sell teak imported from Myanmar on the EU market. The case raises questions about whether it is currently possible to place timber from Myanmar on the EU market while meeting the obligations of the EU Timber Regulation.

A barge laden with timber floats down the Irrawaddy River by Thaths via Flickr

The action is the final action that the Danish Competent Authority, the Environment Agency (Miljøstyrelsen), can take before handing a case over to the police for prosecution.

The Competent Authority carried out audits [link in Danish] at companies that had imported teak from Myanmar as the result of allegations made by the Environmental Investigation Agency. They concluded that all seven of the companies’ due diligence systems were not able to demonstrate a negligible risk of illegality and therefore that none of the companies were able to meet the requirements of the EU Timber Regulation.

The challenge, they said, was that the Myanmar authorities are currently not enabling companies in the EU to access information about the origin of the timber or to adequately assess the legality risks posed by the timber – two key obligations of the EUTR.

The action by the Danish Competent Authority comes on the back of a ruling by a Swedish court last November where a company was deemed to have carried out insufficient due diligence on a shipment of teak from Myanmar because they relied entirely on documents from the Myanmar authorities to demonstrate negligible risk of illegality.

Competent Authorities in Belgium, Italy, Netherlands, Spain and the UK are also investigating possible breaches of the EU Timber Regulation as a result of the import of teak from Myanmar. These cases were also brought to them by the Environmental Investigation Agency.

In an apparent reaction to the Danish ruling, the Myanmar Ministry of Natural Resources and Environmental Conservation released a statement in which they:

  • Acknowledged the challenges in tracing timber back to the forest it came from.
  • Said that the state-owned Myanmar Timber Enterprise, which has a monopoly on the extraction and selling of timber, would stop using sub-contractors.
  • Said that they would streamline their traceability systems.

The local press in Myanmar reports that timber traders have called for an independent third party to monitor teak production to ensure exports comply with EU standards. 

Read the original article on NEPCon's website.