This material has been funded by UKaid from the Department for International Development, with additional support from the European Forest Institute's EU FLEGT Facility. The EU FLEGT Facility is funded by the European Union, the Governments of Finland, France, Germany, the Netherlands and the United Kingdom, and the European Forest Institute. However the views expressed do not necessarily reflect the official policies and views of either DfID or EFI.
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Certification - a means of providing assurance that defined forest areas are managed in accordance with a specified standard, normally including environmental, social and economic, criteria, in addition to legal compliance. The certification process involves the evaluation of a forestry practices on a defined Forest Management Unit against the requirements of the standard by a qualified independent third party. If accompanied by Chain of Custody certification, forest certification can be used to demonstrate through product labelling that wood-based products originate from certified forests.
Certification Scheme - The main forest certification schemes in operation include those of the Canadian Standards Association (CAN/CSA Z809), the Forest Stewardship Council (FSC), the Programme for Endorsement of Forest Certification Schemes (PEFC), the Sustainable Forestry Initiative (SFI) and the Malaysian Timber Certification Council (MTCC). Other certification schemes that may apply to forest areas or forest industry, but are not used for labelling and do not necessarily provide assurance of legal or sustainable forest management, are ISO 14001 for Environmental Management Systems and ISO 9001 for Quality Management Systems. (Click on Issues/Certification on the left hand menu for more information and a selection of relevant documents, news and events.)
Chain of Custody (CoC) - a documented system of demonstrable ownership that establishes the traceability of individual products or shipments from the end user through its various processing steps back to the forest of origin. A secure chain of custody is needed to ensure that timber products which are not from forests managed to certain specifications (for example certified forests) are excluded from supply chains which demand those specifications. A secure chain of custody is essential in ensuring that illegally-produced timber products are excluded from supply chains.
CITES (the Convention on International Trade in Endangered Species of Wild Fauna and Flora) - an international agreement, signed in 1973, that aims to ensure that international trade in specimens of wild animals and plants does not threaten their survival. The Convention is implemented by governments, which control or ban the international trade in any species listed on the CITES annexes. There are currently around twenty five timber species and groups listed on CITES annexes, of which three timber species are traded in significant volumes: big leaf mahogany (Swietenia macrophylla), ramin (Gonostylus spp.) and Afrormosia (Pericopsis elata).
Conflict timber - any wood product that has been sold to fund armed conflict, or that comes from a forest where there is armed conflict over access to the forest resource, either between different external claimants to the resource (such as loggers or rebel groups) or between external claimants people that live in and claim tenure rights to the resource. (Click on Issues/Conflict Timber on the left hand menu for more information and a selection of relevant documents, news and events.)
Consumer countries - countries that import timber or timber products. The need for imports may be because these countries own forest resources are insufficient to meet domestic consumption or processing demands, because they cannot produce specific types or grades of wood product, or because their domestic raw material costs are significantly higher than those of the countries they import from. In some consumer countries, such as China, timber imports are predominantly to process into products that are exported to other consumer countries.
Convention on Biological Diversity (CBD) - a convention negotiated under the auspices of the UN Environment Programme which came into force in 1993. The three goals of the Convention are to promote the conservation of biodiversity, the sustainable use of its components, and the fair and equitable sharing of benefits arising out of the utilization of genetic resources.
Corruption - the misuse of entrusted power for private gain. Transparency International differentiates between according to rule corruption and against the rule corruption. Facilitation payments, where a bribe is paid to receive preferential treatment for something that the bribe receiver is required to do by law, constitute the former. The latter is a bribe paid to obtain services the bribe receiver is prohibited from providing. Corruption is often associated with illegal logging, for example handing out lucrative forest concessions to political associates, high-level political or military involvement in timber smuggling, and extracting bribes for processing and issuing harvest or transport permits. (Click on Issues/Governance and Corruption on the left hand menu for more information and a selection of relevant documents, news and events.)
Development Banks - these are generally publicly-funded institutions that support government investment in economic development in particular geographical regions. They do this through loans for projects that would not otherwise be commercially viable. The World Bank does this on a global scale, and there are also a number of regional development banks which serve particular regions, for example the African Development Bank or the European Bank for Reconstruction and Development. The World Bank provides similar support to the private sector through its sister organisation, the International Finance Corporation. In the past Development Banks have supported large commercial logging and timber processing projects in Asia and Africa, some of which may have encouraged illegal logging. Recently the World Bank has begun exploring ways in which it can support economic development in parallel with better governance in the forest sector.
Export credit agencies (ECAs) - public or para-statal institutions that provide government-subsidised loans, guarantees and risk insurance to corporations seeking to do business in countries where the investment climate is judged to be too risky for conventional corporate financing. Historically ECAs have supported the development of processing capacity, particularly pulp and paper mills in Indonesia, which have run on illegally-sourced timber. They are also involved in many large infrastructural projects, some of which are in high conservation value forest areas.
EU FLEGT Action Plan (European Union Forest Law, Enforcement, Governance and Trade) - adopted in 2003, the action plan is a document setting out the European Commissions range of efforts to stem illegal logging and the entry of illegally-logged timber into EU markets. The core components of the Action Plan are support for improved governance in wood-producing countries, and a licensing scheme to ensure only legal timber enters the EU. This licensing scheme will initially be implemented on a voluntary (but binding) basis, through a series of partnerships with wood-producing countries. Other elements of the Action Plan include co-operation with other major consumer markets, such as the US and Japan, to stop the trade illegally-harvested timber; and efforts to ensure on legally-harvested timber is sourced through public procurement contracts in the EU.
Export/import duties - charges payable on shipments of timber or timber products when they are moved from one country to another. Different products have different levels of duty levied on them by exporting or importing governments, to create an incentive for a particular industry or sector. For example, if a country has a plywood processing industry but no forests of its own, it may choose to encourage establishment of domestic processing with a relatively low duty rate on imported round logs, but high rate on imported plywood. Similarly countries may impose export duties on logs or partially-processed wood products to encourage establishment of downstream processing.
FAO (United Nations Forests and Agriculture Organisation) - aims to help developing countries and countries in transition to modernize and improve their agriculture, forestry and fisheries practices to provide food for their populations. It serves as a home for negotiated agreements and policy debates as well as a source of technical knowledge and information.
FLEG (Forest Law, Enforcement and Governance) - these are regional initiatives that aim to secure high-level political commitment to strengthen forest governance and tackle problems of forest crime and associated trade in illegally-produced forest products. So far three FLEG processes have been initiated through Ministerial Conferences ' in East Asia (Bali, 2001); Africa (Yaound, 2003) and Europe and North Asia (St. Petersburg, 2005). These conferences have brought together producer and consumer country governments, representatives of civil society and industry, and technical experts to explore the roles that each group can play in solving the problems associated with illegal logging in their region. They have resulted in Ministerial Declarations with associated lists of indicative actions. It is intended that FLEG Conferences should be followed up through participants co-operation in implementing identified indicative actions.
Forest Management Unit (FMU) - an administrative structure to govern and manage a geographically determined forest area. Each forest management unit may include several forest compartments. Separate forest harvesting rights may be issued annually in a given forest management unit.
G8 - the 'Group of Eight' consists of Canada, France, Germany, Italy, Japan, Russia, the United Kingdom, and the United States. Together, these countries represent about 65% of the world economy. The hallmark of the G8 is an annual political summit meeting of the heads of government with international officials, though there are numerous subsidiary meetings and policy research. The Presidency of the group rotates every year. During the UK Presidency in 2005, illegal logging was one of the main sustainable development issues that the group considered, particularly its role in undermining development in Africa.
Good Governance - the idea that sustainable economic development cannot flourish in the absence of the rule of law, democratic and transparent government or the protection of human rights. The US Government uses the following principles to determine whether a government is practicing Good Governance or not: free and fair elections; independent judiciary and the rule of law; freedom of speech and press; absence of corruption; and government investment in basic social services. In countries where illegal logging is a problem, this is often because of governance failure, particularly related to their judicial and law enforcement systems. Although no country in the world has perfectly governed institutions, the worse things are in any given state, the less likely its citizens are to be treated fairly or to have an opportunity to escape poverty. Click on Issues/Governance on the left hand menu for more information and a selection of relevant documents, news and events.
Illegal logging - the breaking of laws on cutting, processing and transporting timber or wood products. Substantial controversy surrounds what is and is not legal in many timber producing countries, and it is not always clear which laws should be considered forest-relevant. Generally though, a definition of legal timber would include requirements for logging only where the logger has legal rights to the timber; logging within allowed volume quotas or size restrictions; possession of the necessary authorisations to transport and process logs (for example, into plywood or pulp for paper); and payment of fees and royalties on harvests and applicable export duties. In addition to causing environmental damage frequently associated with illegal logging, companies that do not comply with these requirements are able to generate much greater profits and starve their national governments of revenues, while distorting markets for timber products.
Independent Forest Monitoring (IFM) - monitoring of the range of official processes relating to forest management by an international, independent third party, generally in agreement with state authorities. Processes might include for example the initial allocation of logging concession permits, the management of those concessions and related logging activities, or the subsequent processing and trade in forest products. (Click on Issues/IFM on the left hand menu for more information and a selection of relevant documents, news and events.)
ITTO (International Tropical Timber Organisation) - an organisation established in 1986, under the auspices of the United Nations, amidst increasing worldwide concern over tropical deforestation. While many were alarmed at the rate of destruction of tropical forests, there was also a consensus view that the international timber trade was one of the keys to economic development in those same tropical countries. The ITTO works to reconcile the protection of forests with their economic exploitation, promoting the principles of sustainable forest management and assisting tropical member countries to implement them through projects. In addition, ITTO collects, analyses and disseminates data on the production and trade of tropical timber.
The Lacey Act - US legislation which aims to protect plants and wildlife by creating civil and criminal penalties for a wide array of environmental violations. Most notably, the Act prohibits trade in wildlife, fish and plants that have been illegally taken, possessed, transported or sold. Thus, the Act supports other federal, state, and foreign laws protecting wildlife by making it a separate offence to take, possess, transport, or sell wildlife that has been taken in violation of those laws. It has been proposed that a similar law could be used to tackle the trade in illegally-produced timber products and the European Commission is currently exploring the possibility of enacting EU legislation that might meet this purpose.
Land tenure - the right to exclusively occupy and use a specified area of land. Tenure may also be limited to certain resources ("resource tenure") such as timber but not to all resources in a given area. Tenure may be held by individuals, communities, government, or corporations. Land tenure may be a sensitive issue for governments where customary rights claimed by indigenous forest people are in conflict with the allocation of commercial rights such as logging concessions or utilisation of other natural resources. Some believe that ensuring secure land tenure for rural communities will result in sustainable forest management, reduced illegal logging and alleviation of poverty.
Legality Assurance System - a system for assuring that timber products in an consignment do not include illegal timber. It comprises (i) a definition of legally-produced timber specified in sufficient detail so that compliance can be unambiguously verified; (ii) a process for verification of compliance with all elements of the definition; (iii) a secure chain of custody to track products to assure that products whose production has not been verified as legal do not enter the supply chain; (iv) a mechanism such as licensing for certifying the legality of the consignment; and (v) an external system (ideally supported through third-party monitoring) to maintain its credibility.
Legally-verified timber (or material) - timber or timber product that has been produced in accordance with all the requirements of the definition of legally-produced timber as set out in Section 1. A verified legal source is a source of timber where production activities have been carried out in accordance with all the requirements of the definition of legally-produced timber.
Licensing scheme - a scheme for timber licensing is being established to allow the EU to identify legal timber, and give it preferential access to European markets. The voluntary scheme will be enforced between the EU and those timber producing countries that choose to sign up to it. Licenses will be issued on the basis of credible verification of legal compliance at every stage of the chain of custody of the timber in question. Similar systems underpin a number of international agreements, such as CITES, or the Kimberley Process on conflict diamonds. (Click on Issues/Licensing scheme on the left hand menu for more information and a selection of relevant documents, news and events.)
Money laundering - the act of investing funds in a way that disguises their origin. Some criminals undertake to launder the proceeds of their crime in order to avoid detection. In recent years many countries have written new legislation to restrict money laundering, primarily in an effort to reduce funding for terrorist activities. It can be argued that money laundering should cover benefits (such a profits or interest) gained from exploiting forests illegally and that anti-money laundering legislation should be applicable to transmitting or investing these benefits, although such a case is currently unlikely in the political climate of most timber producing and consuming countries. (Click on Issues/Money Laundering on the left hand menu for more information and a selection of relevant documents, news and events.)
Producer countries - those countries that have significant forest resources and exploit them to produce timber or forest products for international trade. Generally these are net exporters of forest products.
Public procurement policies - governmental policies that set out requirements for purchasing of goods and services by public sector bodies. Amongst other requirements, such as qualifications of suppliers and bidding procedures, they may also specify the environmental quality of products, including the environmental effects of production processes. Some national governments and local authorities have adopted timber procurement policies that specify or give preference to legally- and sustainably-produced products. It is estimated that the total public sector accounts for about 20% of purchases in most developed countries so such policies can exert substantial market influence by creating incentives to demonstrate legal compliance in forest operations and for certified timber products. In the EU public procurement is governed rules aimed at removing barriers and opening up new, non-discriminatory and competitive markets.
Sustainable forest management - a process which allows the utilisation of the forests for multiple purposes (e.g. biodiversity preservation, timber harvesting, non-wood products, soil and water conservation, tourism and recreation) without undermining their availability and quality for present and future generations. The stewardship and use of forests and forest lands in a way, and at a rate, that maintains their biodiversity, productivity, regeneration capacity, vitality and their potential to fulfill, now and in the future, relevant ecological, economic and social functions, at local, national, and global levels, and that does not cause damage to other ecosystems [MCPFE definition since adopted FAO].
Trade - a term used to distinguish the international sale of timber and forest products from sale within a given country, primarily for domestic use.
Verification of legal timber - the process of establishing whether timber has been logged, transported, processed or traded in compliance with applicable laws. This is usually established through regular checks of timber operations accompanied by an independently audited chain of custody system, which traces the ownership and management of the timber from forest to retailer.
WSSD (World Summit on Sustainable Development) - a summit held in August 2002, covering a wide range of social and environmental issues. The Summit's final Plan of Implementation includes the commitment to 'take immediate action on domestic forest law enforcement and illegal international trade in forest products, including in forest biological resources, with the support of the international community, and provide human and institutional capacity building related to the enforcement of national legislation in those areas. A range of forest governance initiatives came out of the Summit, including the Asia Forest Partnership and the Congo Basin Initiative.
WTO (World Trade Organisation) - the international body, established in 1995, that oversees the General Agreement on Tariffs and Trade (GATT) and related international trade agreements. It also fulfils a quasi-judicial function in the case of any international trade disputes; establishing a relatively far-reaching and powerful system of trade rules compared with previous agreements. The requirements of the WTO must be considered when designing policies that affect the international trade in timber and products, such as the EU FLEGT licensing scheme. Some countries have also signed the WTO Government Procurement Agreement (GPA) designed to make laws, regulations, procedures and practices regarding government procurement more transparent and to ensure they do not protect domestic products or suppliers, or discriminate against foreign products or suppliers.
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Last updated 13/07/2006