Procedure : 2013/0205(NLE)
Document stages in plenary
Document selected : A7-0043/2014

Texts tabled :

A7-0043/2014

Debates :

PV 26/02/2014 - 18
CRE 26/02/2014 - 18

Votes :

PV 27/02/2014 - 10.4

Texts adopted :

P7_TA(2014)0167

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24 January 2014
PE 523.022v02-00 A7-0043/2014

on the draft Council decision on the conclusion of the Voluntary Partnership Agreement between the European Union and the Republic of Indonesia on forest law enforcement, governance and trade in timber products to the European Union

(11767/1/2013 – C7-0344/2013 – 2013/0205(NLE))

Committee on International Trade

Rapporteur: Yannick Jadot

DRAFT EUROPEAN PARLIAMENT LEGISLATIVE RESOLUTION
 EXPLANATORY STATEMENT
 OPINION of the Committee on Development
 RESULT OF FINAL VOTE IN COMMITTEE

DRAFT EUROPEAN PARLIAMENT LEGISLATIVE RESOLUTION

on the draft Council decision on the conclusion of the Voluntary Partnership Agreement between the European Union and the Republic of Indonesia on forest law enforcement, governance and trade in timber products to the European Union

(11767/1/2013 – C7-0344/2013 – 2013/0205(NLE))

(Consent)

The European Parliament,

–   having regard to the draft Council decision (11767/1/2013),

–   having regard to the draft Voluntary Partnership Agreement between the European Union and the Republic of Indonesia on forest law enforcement, governance and trade in timber products into the European Union (11769/1/2013),

–   having regard to the request for consent submitted by the Council in accordance with Article 207(3), first subparagraph, Article 207(4), first subparagraph, Article 218(6), second subparagraph, point (a)(v), and Article 218(7) of the Treaty on the Functioning of the European Union (C7-0344/2013),

–   having regard to Rules 81 and 90(7) of its Rules of Procedure,

–   having regard to the recommendation of the Committee on International Trade and the opinion of the Committee on Development (A7-0043/2014),

1.  Consents to conclusion of the agreement;

2.  Instructs its President to forward its position to the Council, the Commission and the governments and parliaments of the Member States and of the Republic of Indonesia.


EXPLANATORY STATEMENT

The goal of the Voluntary Partnership Agreement (VPA) between the Republic of Indonesia and the European Union is to establish a legal framework in order to (i) assure the traceability of timber products, (ii) put in place a verification procedure certifying that timber products shipped into the market of the European Union have been acquired, harvested, transported and exported legally, assuring good management and legal exploitation of the Indonesian forests, and (iii) reinforce the validity of the Forest Law Enforcement, Governance and Trade (FLEGT) action plan of the European Union. The VPA with Indonesia has been concluded on 30 September 2013 at a ceremony held in Brussels.

The conclusion of the VPA with Indonesia is an important step for the EU in its effort to improve the sustainable management of forests at a global scale, to stop deforestation and forest degradation, and to spur systemic changes in the forestry sector, rewarding the efforts of diligent operators that acquire timber from legal and reliable sources, and protecting them from unfair competition. Indonesia is particularly important in this regard. Firstly, it is the world’s third-largest territory for rainforests, after the Amazon and the Congo Basin. This patrimony is however threatened by the unchecked mass destruction of Indonesia's rainforests and carbon-rich peat-lands for palm oil and paper, making Indonesia the world's third largest emitter of greenhouse gases which have an impact on climate change. Secondly, the VPA sets new standards for the management of Indonesian forests. However only about ten per cent by value of Indonesian timber and timber products exports are currently destined for the EU, while the rest is mainly exported to Asian countries. Your Rapporteur is vividly interested in the spill-over effects that a sustainable Indonesian Forest Governance system should have also on timber exports to those markets.

While your Rapporteur consents to the conclusion of the VPA and calls on both sides to ratify the Agreement, he is sincerely concerned about the status of readiness of the Indonesian Timber Legality Assurance System (TLAS)/ Sistem Verifikasi Legalitas Kayu (SVLK). Under the VPA, Indonesian timber and timber products included in the VPA can enter the EU market as FLEGT-licensed timber, which is automatically considered legal under the terms of new EU Timber Regulation which has been applied as of 3 March 2013, once both sides agreed on the terms of the SVLK verification system. Since the approval of the SVLK on the EU side is formalized by way of implementing act under which, as provided for in Art. 291 TFEU, the Parliament is not involved, it is important to appeal to the European Commission to ensure that the SVLK is watertight and fully operational before FLEGT export licenses are issued. At present, the development of the SVLK falls still very short of what is needed to ensure the performance and the integrity of the system and the achievement of the stated objectives of the signed agreement.

To date, less than half of the timber sources in the country have been SVLK certified. Large volumes of unverified timber from forest clearance for agriculture and pulp and paper plantations are entering the supply chain. During the past years there has been a dramatic increase in recorded volumes of such timber, up to nearly three times the volume produced by selective logging concessions(1). Indonesia lost at least 1 240 000 hectares of forest over the period from 2009 to 2011(2), mainly attributable to the expansion of palm oil plantations and forest conversion for pulp concessions. Worryingly, timber and timber products from these areas would enter the EU market with a FLEGT license. At the moment, the SVLK system is not auditing the process which might legitimize timber from forest conversion. It is not auditing the harvesting in the field in ways that could verify compliance with restrictions mandated by guidance accompanying forest conversion permits (IPK) or environmental impact assessments (AMDALs), and is therefore failing to regulate timber stemming from perhaps the worst governed sub-sector of Indonesia’s land uses.

Moreover, the SVLK does not require segregation between SVLK certified timber and non-SVLK certified timber. The non-separation of SVLK and non-SVLK wood material in mills prevents legal certainty at the mill gate. This problem is exacerbated by the fact that SVLK auditors are not explicitly required to audit every stage of the supply chain. SVLK audits also appear to inadequately assess whether or not audited companies have respected land rights of local and indigenous communities in their timber harvesting operations. The Verification Bodies (VB) lack a specific mandate for this role under the present SVLK.

There is ample evidence to suggest that many commercial concessions providing timber for Indonesia’s domestic and export markets, of all types, were at best dubiously acquired, and in some cases acquired illegally. In 2010 the deputy chairman of the Indonesia’s Corruption Eradication Commission (KPK), described the forest sector as “a source of unlimited corruption”. As long as corruption in Indonesia remains entrenched at all levels of government, the credibility for the country to issue FLEGT licenses remains at stake. The corruption problem is exacerbated by the lack of up-to-date, transparent and accessible data and maps. Inconsistencies prevail and lead to multiple interpretations of laws. This results in conflicts with local and indigenous communities. At the same time, basic access to information is required for the Independent Forest Monitor to credibly perform its role. Concession maps, cutting plans, and copies of permits should be a matter of public record.

The proposed mechanism to control the performance of the SVLK relies almost entirely on the auditors and the independent monitors (IM). While the SVLK must be praised for the official role for Independent Monitoring that includes civil society, the capacity of IM networks is limited in terms of human and capital resources. IM activities actually cover only about 5% of the total SVLK certifications issued by verification bodies, due largely to human and capital resources constraints. This needs to be addressed urgently both in terms of scale and quality. Moreover, in order for the IM networks to function properly, the safety of people involved must be guaranteed. It is crucial that violence, threats and any form of abuse toward those who carry out the monitoring is taken seriously and is vigorously prosecuted.

It is utmost worrying that the SVLK system at present does not foresee remedies for the shortcomings indicated above. Indonesia's Ministry of Forestry does not have a clear system for monitoring, cataloguing, and following up on company violation of the SVLK. In effect, companies that are operating in ways that the law prohibits are not likely to be prosecuted, but rather be sanctioned administratively with a request to pass another audit under the SVLK. In this way the SVLK could potentially constitute a bureaucratic barrier to justice in law, and there is a clear danger that companies which fail to comply with the standards of the SVLK are merely given another chance to comply, rather than being reported to enforcement authorities as law-breakers.

Your Rapporteur appeals to the Indonesian authorities to use the occasion of the first review of the SVLK, which is presently taking place, to address all these concerns and to adequately involve all parties of the independent civil society in the review process. The role and involvement of independent civil society monitoring has lend a certain degree of credibility to the SVLK but only if this commitment continues and transparency towards other civil society stakeholders is enhanced.

Your Rapporteur appeals to the European Commission to make sure that the shortcomings of the SVLK are eliminated before any FLEGT license for Indonesian timber products is issued. It is only under this assumption that your Rapporteur recommends consenting to the VPA. Your Rapporteur expects the Commission to present its assessment of the SVLK certification system in Parliament before issuing any FLEGT licence to Indonesian timber products.

(1)

Observations based on Ministry of Forestry data for log production 2006-2010. Sources: Table IV.2.2., page 182 in Bina Usaha Kehutanan, Forestry Business Development Report, at ttp://www.scribd.com/doc/88508089/STATISTIK-KEHUTANAN-2010, and Buku Statistik Kehutanan Indonesia, Ministry of Forestry Indonesia, July 2012, http://www.dephut.go.id/files/BUku%20Statistik%20Juli%202012_terbaru.pdf

(2)

Greenpeace, 2013. Licence to kill. http://www.greenpeace.org/international/Global/international/publications/forests/2013/LicenceToKill_ENG_LOWRES.pdf: p. 4.


OPINION of the Committee on Development (18.12.2013)

for the Committee on International Trade

on the draft Council decision on the conclusion of the Voluntary Partnership Agreement between the European Union and the Republic of Indonesia on forest law enforcement, governance and trade in timber products to the European Union

(11767/1/2013 – C7-0344/2013 – 2013/0205(NLE))

Rapporteur: Kriton Arsenis

SHORT JUSTIFICATION

The voluntary partnership agreement (VPA) between the Republic of Indonesia and the European Union was signed on 30 September 2013 and its purpose is to tackle trade in illegal timber by establishing a licencing system to verify the legality of timber imported into the EU under the FLEGT (The Action Plan on Forest Law Enforcement, Governance and Trade) partnership.

Amongst the partnership agreement that the European Union establishes, FLEGT agreements are the most transparent ones. FLEGT is a valuable tool in forest governance as it establishes proper consultation processes that encourage the effective participation of a wide range of stakeholders, including civil society organizations in partner countries, in policy-making and implementation. In this way, FLEGT processes strengthen the dialogue among stakeholders, defend the interests of forest and indigenous communities, increase transparency and fight corruption. At the same time FLEGT also respects the sovereign rights of producer countries, treating them as equal partners in the process.

Illegal logging undermines responsible forest management, encourages corruption and reduces income of the producer country (by estimations Indonesia lost about USD 7 billion between 2007 and 2011); it has serious economic and social implications for the poor and disadvantaged. VPA aims to tackle the root causes of illegality, which include corruption and lack of clarity about land rights.

Indonesia hosts the third largest rainforest in the world, which covers more than half of the country’s land area (944 000 km2). It includes some of the last intact forests in the world which have remained free of roads. This renders Indonesian forests of global importance due to their biodiversity. At the same time, Indonesian forests are highly important for the global fight against climate change due to carbon sequestration and storage. Yet, Indonesia’s annual net loss of forest area is the third highest in the world. Rapid deforestation and peat land destruction has also made it the world’s third largest greenhouse gas emitter. As climate change is increasingly becoming a source of hunger, poverty, disease and emigration, this agreement is of special significance for the Committee on Development.

VPA sets new standards for the management of Indonesian forests, but its impact on deforestation may remain limited as only about 10% by the value of exports are destined to the EU. However, Indonesia is planning to use its timber legality assurance system for all exports (also outside EU) of commercial timber and timber products. Separate controls to verify the legality of imported timber are still to be developed.

Indonesia began implementing its Indonesian timber legality assurance system SVLK in September 2010 when it started a programme of audits and capacity building across the industry. The Committee on Development emphasizes the importance of SVLK being fully operational before FLEGT export licences are issued. At present, it does not live up to the standards needed to ensure the performance and integrity of the system. Wood certified under the SVLK system should be able to be traced back to a licensed forest concession or a privately-owned forest operating in compliance with Indonesian law. Indonesia’s concession-granting process has been criticised by green groups and human rights organisations, which they say has led to the conversion of valuable primary forests. At the moment, the SVLK system is not auditing forest conversions which might legitimise the process.

A recent Human Rights Watch report, “The Dark Side of Green Growth,” pointed to major shortfalls in the SVLK system, particularly its inability to protect against land tenure rights abuse as the audit process does not guarantee that permits were issued by the government on land without pre-existing land claims or that companies compensated communities for lost land or obtained free, prior and informed consent before beginning operations. Land conflicts linked to logging and plantation concessions are common in Indonesia, and this oversight represents a significant gap in the SVLK certification.

A key strength of the Indonesian SVLK system is the responsibility given to civil society groups and individuals to raise objections about the audit. However, there is a need to improve the monitoring skills and ensure the security of people undertaking this task.

The Committee on Development would like to encourage the Government of Indonesia to show a strong political will in implementing VPA in order to achieve improved forest governance and recognition of tenure rights of forest and indigenous communities.

The Committee on Development calls on the European Commission to ensure that the deficiencies of the SVLK system are eliminated and SVLK is fully operational before any FLEGT license for Indonesian timber products is issued. It is only under this condition that the Committee on Development recommends consenting to the VPA.

*******

The Committee on Development calls on the Committee on International Trade, as the committee responsible, to propose that Parliament give its consent.

RESULT OF FINAL VOTE IN COMMITTEE

Date adopted

18.12.2013

 

 

 

Result of final vote

+:

–:

0:

18

1

0

Members present for the final vote

Ricardo Cortés Lastra, Véronique De Keyser, Catherine Grèze, Mikael Gustafsson, Filip Kaczmarek, Miguel Angel Martínez Martínez, Gay Mitchell, Norbert Neuser, Bill Newton Dunn, Birgit Schnieber-Jastram, Michèle Striffler, Alf Svensson, Ivo Vajgl, Daniël van der Stoep, Anna Záborská

Substitute(s) present for the final vote

Kriton Arsenis, Santiago Fisas Ayxela, Isabella Lövin

Substitute(s) under Rule 187(2) present for the final vote

Jolanta Emilia Hibner


RESULT OF FINAL VOTE IN COMMITTEE

Date adopted

21.1.2014

 

 

 

Result of final vote

+:

–:

0:

29

0

0

Members present for the final vote

Laima Liucija Andrikienė, Maria Badia i Cutchet, David Campbell Bannerman, Daniel Caspary, María Auxiliadora Correa Zamora, Christofer Fjellner, Yannick Jadot, Metin Kazak, Franziska Keller, Bernd Lange, David Martin, Vital Moreira, Paul Murphy, Godelieve Quisthoudt-Rowohl, Niccolò Rinaldi, Helmut Scholz, Peter Šťastný, Robert Sturdy, Henri Weber, Jan Zahradil, Paweł Zalewski

Substitute(s) present for the final vote

Catherine Bearder, Béla Glattfelder, Syed Kamall, Elisabeth Köstinger, Katarína Neveďalová, Tokia Saïfi, Peter Skinner, Jarosław Leszek Wałęsa

Substitute(s) under Rule 187(2) present for the final vote

Sophie Auconie, Franco Frigo

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