Responsible Wood Sourcing in Vietnam

Amy Smith & Le Cong Uan Webinar for Sustainable Furnishings Council

August 15, 2013

Disclaimer

This presentation is for educational and

informational purposes only and is not intended

and should not be construed as legal advice.

Persons seeking legal advice on compliance

with the Lacey Act or any other law, regulation

or requirement should consult with a qualified

legal professional.

Amy Smith Uan Le Cong

World Wildlife Fund Working to conserve nature

and reduce the most pressing threats to the diversity of

life on Earth

Photo: naturepl.com / Edwin Giesbers / WWF

13. Mekong 14. Mesoamerican Reef 15. Namibia 16. Northern Great Plains 17. Southern Chile 18. Yangtze

1. Amazon 2. Amur-Heilong 3. Arctic 4. Borneo & Sumatra 5. Chihuahuan Desert 6. Coastal East Africa

7. Congo Basin 8. Coral Triangle 9. Eastern Himalayas 10. Galapagos 11. Gulf of California 12. Madagascar

1

2

3

4

5

6 7 8

9

1 10

1 11

1 12

1 13 1 14

1 15

1 16

1 17

1 18

Our work is global and focused on critical regions We concentrate our efforts on protecting the world’s most important natural places

80 percent of the world’s terrestrial biodiversity

over 1.6 billion people depend on forests for survival

forest degradation gateway to deforestation

working forests keep trees standing and forests intact

Local forests.

Global markets.

Engaging with companies committed to responsible forest products

for

ask FSC®

SFC Presentation

Key Sourcing Issues in Vietnam

• Vietnam has 16.2 million ha. (40 million acres) of

forest, of which 10.2 million ha are considered natural forest.

• In 1992, Vietnam imposed laws to control logging within its borders. Result = manufacturers began relying on other countries for their timber supply, fueling illegal/unsustainable logging in key forest regions (i.e., Laos, Myanmar, Cambodia, Indonesia, Malaysia, Congo Basin countries, Amazon countries, etc.).

Vietnam Forest Facts

Common types of forest-level illegalities

• Artisanal (small-scale) logging

• Logging of protected species

• Logging outside of licensed areas and in protected areas, including logging in licensed areas where harvest is prohibited

• Logging more than allowed volumes on authorized logging sites

Other common illegalities

• Illegal sawmilling

NOTE: Main concern is legality/sustainability of timber imports

Examples of timber illegality in Vietnam

The Lacey Act

Vietnam’s Timber Trade

• Vietnam imports timber from many countries for furniture production: most plantation timber is FSC-certified;

• Main species harvested in Vietnam: acacia, eucalyptus

• Main imported species: acacia, eucalyptus, pine, oak, ash

• Vietnam’s regulations are consistent with requirements of Lacey Act/EUTR, but how to verify imported timber is not yet fully addressed

• Local buyers unaware of regulatory requirements in timber country of origin and lack sufficient documentation from suppliers

New/revised regulations in Vietnam

• Circular No. 01/2012/TT-BNNPTNT- procedure for legality of timber and verification of timber origin;

• Circular No. 35 /2011/TT-BNNPTNT: regulation on harvesting design, harvesting permit.

• Yellow balau (Shorea spp.) imported from Laos

• Burmese teak (Tectona grandis)

• Keruing (Dipterocarpus spp.)

• (Erythrophleum fordii)

• (Sindora spp.)

High Risk Species

to support sustainability practical steps

illegal and unsustainable wood

avoid

• Instances of misinformation from domestic and international suppliers about species, country of origin

• Request documents from suppliers demonstrating region and FMU of origin

• Inability to supply such information should be a deal-breaker

Clearly identify the species and country of origin Yellow

balau

Keruing

Burma

paduk

• require suppliers to provide documentary evidence of legal procurement, which may include harvest permit

• VAT invoice issued by forest owner, sawmill, trader

• sales contract for timber between forest company and sawmill or secondary wood processors

• transportation permit (depending on province)

• timber delivery list issued by sawmill

• verification of timber harvest issued by local forest ranger (Kiem lam)

• CITES permits if applicable

Check documentation

For high risk:

Option 1: Buy FSC-certified products. Best option, lowest risk, but supply is not always available.

Option 2: Establish rigorous due care system, including referencing country’s legality framework and obtaining 3rd party legality verification. Contact local GFTN office for support.

If options 1 or 2 aren’t possible, exclude these high-risk products/sources from your supply chains.

For low risk: Collect key documents and conduct 1st party verification.

How to address risks and source responsibly

FSC FM and CoC in Vietnam as of July 2013

• Total FSC certified forest: 50,000 ha. (123,000 acres)

• Another 38,000 ha. (93,900 acres) to be certified this month

• Mostly acacia

• 415 FSC CoC certificates

Challenges

• For imported wood, legality requirements and documentation vary country to country, making traceability more complex (i.e., can import roundwood from S. America but not Malaysia)

• Suppliers often buy from trader so can’t obtain concession number, invoice between forest and trader/sawmill.

• Launched in 2006

• 10 participants (9 manufacturers/forest participants, 1 trader)

• All participants have FSC CoC

• Clients are mainly from US, EU

• Timber used is 90% FSC-certified

• Main species: acacia, eucalyptus, pine, oak, ash, teak

How GFTN Vietnam works with participants

- Baseline assessment: evaluate sources of wood and identify challenges they have with traceability

- Develop a trade action plan with them for timber sourcing for 5 years

- Conduct annual monitoring audit to check the progress of action plan implementation

How GFTN can help

Training:

• Legality training (Lacey Act, VPA/FLEGT, EU TR) for manufacturers, wood suppliers;

• New/revised forestry regulations;

• FSC Certification

Market Information:

• Provide insights on Vietnamese market and help identify responsible sources;

• Arrange business meetings among GFTN producers and buyers

• Arrange for GFTN-VN participants to participate in trade shows outside of VN

• Assess timber legality of wood supply outside of VN before purchase occurs

GFTN Tools and Trainings

Resources for risk assessment/mitigation

www.gftn.panda.org/sourcing

Lacey Act Online Training

gftn.panda.org/resources/gftn_online_courses/

Legality Guidance

www.marketplace.fsc.org Researching FSC supply

Additional resources http://www.globalforestregistry.org/map

Additional resources http://www.forestlegality.org/risk-tool

GFTN Vietnam Profile

…in responsible wood products

Growing the trade…

Thank you

Questions?

GFTN

http://gftn.panda.org

GFTN-Vietnam

http://gftn.panda.org/gftn_worldwide/asia/vietnam_ftn

Amy Smith

amy.smith@wwfus.org

Le Cong Uan

uan.lecong@wwfgreatermekong.org