Tax and accounting insights for Ukraine
19.11.24
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How Ukraine can adapt to the EU forest policy

On November 12, EBA Committees Manager Yuriy Andriyiv, together withBohdan Tsupryk , Chairman of theWoodworking and Furniture Committee , and Maksym Polyakov, Deputy Chairman of the Committee, took part in a meeting on compliance with EU Regulation 2023/1115.

During the meeting, business representatives voiced the following issues that need to be addressed.

The need to add the geographical coordinates of logging sites to the TTN-Forest and logging ticket. The EBA member companies note that for areas of less than 4 hectares, one point is enough, for areas of 4 hectares and more, a sufficient number of points is needed to describe the contour of the site. The coordinates consist of latitude and longitude values, which must be specified with at least six decimal places in the coordinate system.

Possibility to receive TTN-Forest in electronic form. Today, it is possible toreceive logging tickets in electronic form with a QR code and partially - material and monetary valuations of the areas for which logging tickets have been issued.On the website https://open.ukrforest.com/, it is possible to check the existence of TTN-Forest and basic data on the delivery (date, seller, buyer, vehicle and total volume of forest). However, there is no possibility to obtain TTN-Lis in electronic form. The only way to receive TTN-Lis in electronic form for further transfer to buyers of wood products as proof that the wood was harvested and delivered for processing legally is to scan paper TTNs received from forestry enterprises, which requires significant human resources. Thus, the introduction of an electronic TTN-Forest with the ability to scan the QR code on it and enter information using it will significantly facilitate the accounting, consolidation and provision of information to EU buyers.

Including detailed information on wood species in logging tickets or attaching material and monetary estimates. According to business representatives, felling tickets only indicate the type of timber growing in the area where the felling ticket authorizes felling (e.g., softwood, hardwood, or coniferous). Therefore, providing only logging tickets as evidence of the legality of timber harvesting is not enough. Actual volumes of timber by species are indicated in the Listing and Evaluation Statement (detailed FIT). Accordingly, in addition to logging tickets, it is necessary to additionally receive from the branches and combine with logging tickets the MOU. As noted earlier, for some branches it is already possible to download the MOU from the website of the SE "FIAC", but not for all.

Certification of all branches of the SE "Forests of Ukraine" in accordance with the FSC national standard of the forest management system for Ukraine. According to business representatives, the number of customers demanding products made of FSC certified wood is increasing every year. The volume of products that require additional volumes of such wood is also increasing . According to the EBA member companies, 93 branches of the State Enterprise "Forests of Ukraine" out of 145 are certified under the FSC system. This is not enough to provide all FSC buyers with certified products.

Even if the above-mentioned regulation is postponed for one year, which is currently being prepared for a vote by the European Union, according to EBA member companies, these issues need to be resolved in the near future to prevent the risk of stopping the export of Ukrainian wood products to the EU.

The European Business Association is grateful to the State Agency of Forest Resources of Ukraine, State Enterprise "Forests of Ukraine", State Enterprise "Forestry Innovation and Analytical Center" for organizing the meeting and engaging business in the discussion, and looks forward to further cooperation!

 

European Business Association
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