Despite sanctions on the imports of Russian and Belarusian, wood products, birch plywood and other wood products from Russia keep finding their way to the EU through third countries.
As explained in our post on the alternatives that exist to Russian and Belarusian birch, the EU responded quickly with sanctions after Russia’s invasion of Ukraine in February 2022. These sanctions included a complete prohibition of Russian timber imports into the EU starting from July 2022.
However, although direct trade between Russia and the EU was hindered, these products keep circumventing sanctions through third countries and landing on EU shores. A team of journalists from German’s national public television revealed earlier this year that the Russian product comes through China. At the same time, the Belarusian Investigative Center discovered that Belarusian wood products find their way through Kazakhstan and Kyrgyzstan.
China and Central Asia are the main sources
Trade data clearly shows that as imports from Russia and Belarus came to a halt these volumes were diverted to other countries. An exponential trend in import volumes of birch plywood from countries like Kazakhstan, Turkey and China quickly took place, but lately, also other countries such as Uzbekistan, Georgia, or Kyrgyzstan are following this trend.
According to the investigation conducted by the Belarusian Investigative Center (BIC), Siena, and a network of OCCRP, “wood companies are evading these restrictions using misleading paperwork claiming their shipments come from Kazakhstan or Kyrgyzstan”.
The same investigation shows that in the Lithuanian and Latvian borders with Belarus, customs officials are struggling to stop sanctions evasion, but it is not an easy task, since the legal framework of sanctions bans only wood imports from Russia and Belarus. Thus, smugglers just declare the goods are imported from Kazakhstan and Kyrgyzstan, declaring them under other customs codes.
The risks to evade the sanctions are high
Industry and trade associations like Timber Development UK or the European Timber Trade Federation as well as the French association Le Commerce du Bois (LCB) and the General Association of German Timber Trade, have warned the market about the risk of importing wood products of Russian origin.
These practices can result in serious sanctions such as fines, confiscation of profits, or up to four years in prison apart from the loss of reputation for the company, its customers, and the sector. Such practices will also undermine the effectiveness of the EU’s sanctions against Russia and Belarus.
At present, the import of Russian and Belarusian plywood and timber products faces potential penalties through various mechanisms, including:
- Breach of EU sanctions against Russia and Belarus.
- Infringement of anti-dumping investigations and duties on Russian birch plywood. This applies to plywood products attempting to bypass regulations by passing through third countries.
- Contravention of the EU Timber Regulation (EUTR).
- Violation of PEFC and FSC chain of custody certificates. Both certification schemes classify timber from Russia and Belarus as conflict timber.