i

A matter of factComplying with Lacey Act and the FLEGT Action Plan in India

Sustainable and Responsible Trade Promoted to Wood Processing SMEs through Forest and Trade Networks in China, India and Vietnam.

ii

A MATTER OF FACT: Complying with Lacey Act and the FLEGT Action Plan in India

Project Advisor: Samir Sinha

Project Consultant: Ritwick Dutta

Project Coordinator: MKS Pasha

This report has been produced by Traffi c India and submitted tp WWF-India.

Further information

Information about the European Union is available on the Internet. It can be accessed through the Europa server (www.europa.eu) and the website of the Delegation of the European Union to India (www.delind.ec.europa.eu).

Legal notices:

European Union This publication has been produced with the assistance of the European Union. The contents of this publication are the sole responsibility of Traffi c-India and GFTN India and can in no way be taken to refl ect the views of the European Union.

Copyright noticeReproduction is authorised, provided the source is acknowledged, save where otherwise stated.

The European Union is made up of 27 Member States who have decided to gradually link together their know-how, resources and destinies. Together, during a period of enlargement of 50 years, they have built a zone of stability, democracy and sustainable development whilst maintaining cultural diversity, tolerance and individual freedoms. The European Union is committed to sharing its achievements and its values with countries and peoples beyond its borders.

“This publication has been produced with the assistance of the European Union. The contents of this publication are the sole responsibility of Traffi c-India and GFTN India and can in no way be taken to refl ect the views of the European Union.”

Internal draft for discussion: Not to be quoted

i

A matter of factComplying with Lacey Act and the fl egt Action Plan in India

2010

ii

1

Across the world, illegal exploitation of natural resources is rampant and increasing at a fast rate. In case of timber the situation is particularly worrying. In some countries the production of illegal timber equals the production of legal timber and in some other countries the illegal timber economy is in fact larger. An illegal economy of this kind is very often associated with corruption and organised crime. Weak forest governance systems in countries where there is substantial national and international trade in timber and timber-based products are unable to cope with the extent of illegal activities. Due to this legitimate forest-based industries suffer and become less competitive. The huge profi ts which can be made through illegal exploitation of natural resources, have made it fi nancially very attractive, leading to large-scale destruction of forests and wildlife. While there are several issues on the supply-side of the timber economy which have allowed for the growth of a parallel illegal timber economy, huge international demand also encourages such an economy. Certain recent initiatives in the USA and Europe – both signifi cant markets for timber and timber-based products – have been undertaken to combat illegal exploitation of timber by directing the demand for such products towards legally harvested timber.

Very few amendments in the domestic law of a country have had such far reaching implication on international trade as the amendment in 2008 of the century old Lacey Act of the USA. Usually the jurisdiction of a national law is restricted to the domestic territory of a country since a country does not generally have the legal right to implement its national laws beyond its own territory. This however, does not mean that the impact of national laws is not felt outside the geographical boundaries

INTRODUCTION

2

of a country. Given that globalization today is a reality, many local laws can have international implication especially where the law concerns international trade related issues. The Lacey Act amendment of 2008 has expanded the scope of the Act which was originally concerned essentially with combating hunting of wild animals and birds to a legislation restricting and regulating the import of timber and plants.

It is essential to trace the reason for the amendment to the Lacey Act in 2008. For years, experts have pointed out that the absence of ‘plants’ from the Lacey Act was a glaring omission. At the same time, the devastating impacts of illegal logging and associated trade on local communities and invaluable ecosystems and the lack of effective governance particularly environmental governance was well documented. As it became clear that amending the Lacey Act would be an effective measure to address these issues, the legislation was proposed in the U.S. Congress by Representative Earl Blumenauer and Senator Ron Wyden, both from Oregon, in 2007. A precedent- setting coalition of environmental, industry, and labor groups backed these bills, recognizing the need for the world’s largest consumer market (USA) to take action at home to curb illegal wood and plant product imports. It was hoped that a stricter check on the source of wood will help in combating global deforestation through illegal logging.

To address illegal logging and other illegal plant trade, the Lacey Act now does three main things:

• Prohibits all trade in plant and plant products (e.g., furniture, paper, or lumber) that are illegally sourced from any US state or any foreign country.

• Requires importers to declare the country of origin of harvest and species name of all plants contained in their products.

• Establishes penalties for violation of the Act, including forfeiture of goods and vessels, fi nes and jail time.

Understanding the amendment to the Lacey Act is crucial for exporters, importers of plant products as well as for enforcement offi cials belonging to Customs, Forest and other related departments. The Lacey Act amendment is unique in the sense that it impacts exports from a country by forcing exporters of plant and plant products to the USA to follow the provisions of the domestic law with respect to harvesting, transport and processing of plant and plant products. Even if no action is taken in India for violation of forest laws of India, action can be taken against the importer in the USA under the Lacey Act for violation of forest law in India. For e.g. an importer imports Sheesham (Dalbergia shishoo) furniture from India and it is later found that the said wood was illegally procured from a Protected Area. Even if no action was initiated against those responsible for illegal procurement from the Protected Area, as the procurement was illegal, the subsequent import of that wood would constitute a violation of the US Lacey Act. This provision ensures that the importer of plant and plant product is bound to ascertain that the laws related to forests are complied with in the country from where the plant and plant products are imported.

The Lacey Act provisions impact imports to the USA from all countries. Importers of plants and plant products in the USA have to ensure that the harvest of the

3

plant has been done legally and no law is violated throughout the process starting from the harvest to the import of the plants/plant products. This means that suppliers/exporters in all countries - where the plant is harvested, where it is processed/ packaged, through which it is transported – would be affected by the Act. Compliance with the provisions of the Lacey Act is not simple: the reason being that unlike most laws, it is not a ‘document based law’ but rather a ‘fact based law’. It is up to the private sector to comply as it sees fi t. In other words, a company is not required to match any one standard of legality documentation or due diligence — and, conversely, no document is a 100% guarantee of legality in and of itself.

While Lacey Act is the American initiative to combat trade in illegal plant and plant products, the EU launched an Action Plan in 2003 to stop illegal logging. This Action Plan known as the EU Forest Law Enforcement, Governance and Trade (FLEGT) Action Plan aims at combating the problem of illegal logging through a number ways which primarily focus on providing support to timber-producer countries to achieve certain objectives relating to better forest law enforcement.

The Action Plan is implemented through Voluntary Partnership Agreements (VPAs) which are binding bilateral agreements between the EU and a timber-producing country. The VPA lay down the commitments and actions of both the parties to reduce illegal logging. The country with which the VPA is signed with, i.e. the Partner country, will issue licenses to timber exporters in its country or to export consignments only if the legality of the sourced timber is assured. The EU countries while importing wood from the Partner country would only import such licensed wood and may prohibit import of unlicensed from the Partner country. The ‘legality’ of the wood is based on the legal defi nition prevalent in the Partner country. The legality of the entire process – starting from sourcing of wood to processing it and then fi nally exporting- is taken into consideration. The VPA can also include provisions to examine the legality of timber which has been imported from a third country into the Partner Country before further export to the EU.

What may be pointed out is that unlike the Lacey Act which impacts wood imports from all countries, the FLEGT Action Plan only affects imports from countries with which the EU has signed a VPA. There is no VPA between India and the EU. However, this does not mean that the FLEGT cannot impact Indian exporters at all. The impact of FLEGT on Indian exporters is limited to situations where Indian exporters have exported timber to a Partner Country where it is being processed before further export to the EU.

In October 2010, the European Union passed a law to prohibit the sale of illegal timber and timber products in the EU market. It places a duty on all persons who bring timber or timber products to the EU market to ensure that the timber has been legally harvested. This law, which is likely to come into force in 2012, will have a much wider impact than the FLEGT Action Plan as it is not restricted to exporters who belong to the countries which have entered into VPAs with the EU.

The present publication is intended to guide those involved in exporting plant and plant products to the USA as well as to Europe. The fi rst Part of the Publicationdiscusses the amendment to the Lacey Act and the second Part looks at the FLEGT

4

Action Plan. In the third Part, information with regard to various laws and Court rulings which are relevant to forest conservation in India generally and particularly with regard to the three Indian states of Kerala, Rajasthan and Uttar Pradesh has been provided in the context of the requirements of the Lacey Act Amendment and the FLEGT Action Plan.

3

THE NEED FOR AMENDMENT OF THE LACEY ACT IN 2008

The Lacey Act is a domestic law of the United States of America. The Amendment of 20081 prohibits trade of illegally sourced plant and plant products in USA. One of the reasons for the US to amend the Lacey Act is that it wanted to acknowledge and support efforts made by other countries to conserve the natural resources of their country. The prohibition under the Amended law acts as a disincentive for people to break forest conservation related laws in the US as well as in other countries. One of the reasons is that there are strong economic reasons for the continuing illegal logging in the growing exports of plant and plant products to the USA. The exports themselves may be legal however, the procurement of the plant and plant products may not have followed the rules and regulations of the country exporting the same. The aim of the amendment was to broadly ensure that the high demand of the plants and plant products does not become the reason for the breach of laws and rules with respect to forest conservation in other countries. It is important to emphasize that the Lacey Act provisions are applicable only in relation to exports to the USA and not to any other country.

MEANING OF ‘PLANT’ AND ‘PLANT PRODUCT’

The defi nition of plant under the Act is ‘any wild member of the plant kingdom, including roots, seeds, parts, and products thereof, and including trees from

1 The 2008 Farm Bill (the Food, Conservation, and Energy Act of 2008), effective from May 22, 2008, amended the Lacey Act by expanding its protection to a broader range of plants and plant

products.

PART I US LACEY ACT

4

either natural or planted forest stands’. Thus, a plant, as defi ned by the law, includes any part or derivative product of any wild member of the plant kingdom, including treesharvested from plantations. This includes all wood products such as paper, furnitureHowever, there are some exceptions:

• Live trees or other live plants intended for replanting, unless they are listed on the Convention on International Trade in Endangered Species of Wild Fauna and Flora (CITES), the Endangered Species Act (ESA) or a state endangered species list.

• Scientifi c specimens to be used only for research, unless they are listed on CITES, the ESA or a state endangered species list.

• Common food crops and cultivars, such as corn, cotton or cut fl owers.

SITUATIONS WHICH LEAD TO THE VIOLATION OF THE LACEY ACT

The Lacey Act is concerned with the trade in illegally sourced plant and plant products. The illegality can occur at any point in the ‘supply chain’ and that point of the supply chain could be based anywhere in world. ‘Supply Chain’ refers to ‘the network of retailers, distributors, transporters, storage facilities and suppliers that participate in the sale, delivery and production of a particular product’.2

This means suppliers and exporters of forest products to the US, irrespective of their nationality, would be affected by the Act and have to ensure that any export to the USA is in accordance with the Act.

For the Lacey Act to be triggered two-level violations have to occur-

First – violation of a law which is related to protection or management of plants or products derived from plants has to take place. This law could be American or of any other country. The violation need not be criminal in nature. It is also not necessary that the law is actively enforced by the country in which the violation is occurring. This is especially relevant in the context of most countries of the world where environmental laws and forest laws rarely effectively enforced.

Second – after the fi rst violation has been committed, the product which has been procured through the fi rst violation has to be traded in the US. It is at this point that the Amended Lacey Act will be violated. The trade in the US could be export, import, transport, sale, or purchase. Any of these acts would trigger a violation under the Amended Lacey Act.

2 Defi nition as available at http://www.investorwords.com/4823/supply_chain.html#ixzz116BxK0qi

5

REQUIREMENTS UNDER THE LACEY ACT

The Amended Lacey Act requires all importers of plants and plant products in the US to make certain declarations which include the following:

Under the Lacey Act, importers are required to declare the following information about the shipment of plants and/or plant products:

If any information provided in the Declaration is false, then it would constitute a violation of the Lacey Act.

ACTS PROHIBITED UNDER THE LACEY ACT

The following acts are prohibited under the Act:

• Trade in illegally sourced plants or plant products

INTRODUCTION

6

Illegality is based on the violation of the law which the plant or plant product(such as furniture, fl ooring, paper) is subject to at that time.

For example: if the timber is logged in a Reserve Forest in Andhra Pradesh, then the Andhra Pradesh Forest Act will be the applicable law, and if there is a violation of this law, then the fi rst-level violation would take place. If subsequently, this timber is imported by the US, then the second-level violation under the Lacey Act would be take place.

• False declaration

Information that is required to be provided under the Lacey Act has to be true and correct and a false declaration would constitute a violation under the Lacey Act.

Examples of prohibited activities-

1. Theft of timber (for example from a Reserve Forest or felling of prohibited species whether from Forest and Non Forest land)

2. Taking plants from an offi cially protected area, such as a national park or sanctuary contrary to the laws governing the extraction of plants from such notifi ed areas

3. Failure to pay appropriate royalties, taxes or fees associated with the plant’s harvest, transport or commerce

4. Trade in products made from illegally harvested timber

5. Trade in plant products which are in violation of laws governing export or trans- shipment, such as a log-export ban.

A violation under the Lacey Act will be triggered by the violation of any law pertaining to the plant based merchandise - it could be the US State law, Indian law or law of any other country. Violation of laws, other than the Lacey Act, could occur at any stage – import, export, transport, sale, receipt, acquisition, or purchase. At any point in these stages, if the law pertaining to the merchandise at that stage is violated, then the violation under the Lacey Act is triggered. There is no comprehensive database of the laws and the onus lies on the importer of the merchandise to be aware of which lawsapply to the merchandise.

1.2 BACKGROUND

Penalties under the Lacey Act vary according to the state of mind of the person committing the offence – i.e. whether the prohibited activities under the Act have been undertaken knowingly and unknowingly. Penalties are of various kinds – criminal fi ne, prison term, civil fi ne and forfeiture of goods. The type and amount of penalty depends not only on whether the violation was committed knowingly or unknowingly but also when ‘due care’ has been exercised by the importer. Due care has been defi ned in American law as -

“that degree of care which a reasonably prudent person would exercise under the same or similar circumstances.”

7

However, this defi nition is not very clear and there is a lack of certainty with regard to how the Courts would apply it in different cases. In view of this, it is advisable that all individuals/importers/companies whose activities are likely to fall within the ambit of the Lacey Act, exercise maximum caution and use as many tools, technologies and resources to ensure that their supply lines are not hit by illegality at any step. Nationals and companies of countries other than the US can also be prosecuted and penalised under the Lacey Act.

The prosecution would be for the violation of this Act – i.e. trade in illegally sourced plants or plant products in the US or giving a false declaration. Persons cannot be prosecuted for the violation of laws of other countries. Penalty under the Lacey Actwould be on the person who traded in illegally sourced plant/plant products in the US.

PENALTIES UNDER THE ACT

Penalties under the Lacey Act vary according to the state of mind of the person committing the offence – i.e. whether the prohibited activities under the Act have been undertaken knowingly and unknowingly. Penalties are of various kinds – criminal fi ne, prison term, civil fi ne and forfeiture of goods. The type and amount of penalty depends not only on whether the violation was committed knowingly or unknowingly but also when ‘due care’ has been exercised by the importer. Due care has been defi ned in American law as -

“that degree of care which a reasonably prudent person would exercise under the same or similar circumstances.”

However, this defi nition is not very clear and there is a lack of certainty with regard to how the Courts would apply it in different cases. In view of this, it is advisable that all individuals/importers/companies whose activities are likely to fall within the ambit of the Lacey Act, exercise maximum caution and use as many tools, technologies and resources to ensure that their supply lines are not hit by illegality at any step. Nationals and companies of countries other than the US can also be prosecuted and penalised under the Lacey Act.

The prosecution would be for the violation of this Act – i.e. trade in illegally sourced plants or plant products in the US or giving a false declaration. Persons cannot be prosecuted for the violation of laws of other countries. Penalty under the Lacey Actwould be on the person who traded in illegally sourced plant/plant products in the US.

How is a violation of Lacey Act Triggered in India?

• When any law, rules, or orders with respect to plant and plant products is violated.

• The violation can be at any stage: Harvest, transport, processing, siting of wood-based units. E.g. if sawn timber is procured from saw mills located within a certain distance from a reserve Forests, which is prohibited under the local forest law, the violation of Lacey Act will be triggered. Similarly, if the law mandates that timber must be harvested only in accordance with approved working plan and the same has not being followed a Lacey Act violation will be triggered.

8

If the US importer knowingly engaged in prohibited conduct –

Trade in illegally sourced products Criminal felony fi ne Up to $500,000 for corporation, $250,000 for individual, or twice maximum gain/loss from transaction

Prison Up to 5 years

Forfeiture of goods

False import declaration Criminal felony fi ne Up to $500,000 for corporation, $250,000 for individual, or twice maximum gain/loss from transaction

Civil penalty Up to $10,000

Prison Up to 5 years

Forfeiture of goods

If the US importer knowingly engaged in prohibited conduct –

Did not exercise‘due care’

Trade in illegally sourced products Criminal misdemeanor penalty Up to $200,000 for corporation $100,000 for individual, or twice maximum gain/loss from transaction

Prison Possible for up to one year

Civil penalty fi ne up to $10,000

Forfeiture of goods

False import declaration Civil penalty fi ne $250

Possible forfeiture of goods

Practiced ‘due care’ Trade in illegally sourced products Forfeiture of goods

False import declaration Civil penalty fi ne $250

Possible forfeiture of goods

9

INTRODUCTION TO THE FLEGT ACTION PLAN

In 2002, at the World Summit on Sustainable Development (WSSD) held in Johannesburg, the European Commission made a commitment to combating illegal logging and associated timber trade. This commitment took the shape of the Forest Law Enforcement, Governance and Trade (FLEGT) Action Plan which was fi rst published in May 2003. The FLEGT Action Plan focuses on seven broad areas:

1. Support to timber–producing countries

The Action Plan aims at providing fi nancial and technical support to timber-producing countries to improve forest governance systems and processes. This includes development of reliable verifi cation systems to identify legally harvested timber; improved transparency and access to information; capacity building for improved policy making and support for governance institutions.

2. Activities to promote trade in legal timber

The Action Plan proposes the promotion of trade in legal timber through bilateral agreements between timber exporting countries and the EU and

PART II

FOREST LAW ENFORCEMENT, GOVERNANCE AND TRADE (FLEGT)

10

through a multilateral framework of international collaboration between signifi cant importers of timber such as the US, Japan and China.

3. Promoting public procurement policies

The Action Plan encourages member states of the EU to adopt procurement policies that favour legally harvested and verifi ed timber.

4. Support for private sector initiatives

The Action Plan aims to provide support to private sector in timber exporting countries so that the forest management practices undertaken by them comply with the legal norms of the country and they adopt corporate social responsibility standards.

5. Safeguards for fi nancing and investment

As high investment in the forest sector is one of the factors encouraging illegal logging, the Action Plan aims to encourage Banks and fi nancial institutions to take into consideration long-term legal supply, along with environmental and social factors before making investments.

6. Use of existing legislative instruments or adoption of new legislation to support the Plan

There are certain existing national and international legislative instruments which can be relied on to combat illegal logging.

7. Addressing the problem of confl ict timber

The Action Plan aims to develop a better defi nition of confl ict timber and better recognize the links between forest and confl icts.

APPLICABILITY OF THE FLEGT ACTION PLAN

The FLEGT Action Plan is implemented in timber-exporting countries which enter into a Voluntary Partnership Agreement (VPA) with the EU. Unlike the Lacey Act discussed in the previous section, the FLEGT Action Plan is not a national legislation and it is not mandatory. It would only apply to countries which have agreed to a VPA and the terms and conditions of the VPA, which would guide the implementation of the FLEGT Action Plan, are binding on the Partner country and the EU. Ghana, Cameroon and the Republic of Congo have entered into VPAs with the EU and negotiations are on with other countries as well. An important part of each VPA is a Legality Assurance System and an associated licensing system. Trade with countries which have not entered into a VPA with the EU are not affected by the FLEGT Action Plant

India has not signed a VPA with the EU and therefore Indian timber-exporters to the EU are not affected by the FLEGT Action Plan. However, the EU Regulation against Illegal Logging which has been passed by the European Parliament and the Council in October 2010 would apply to Indian exporters when it comes into force. The Regulation is likely to come into force in 2012 and it places obligations on persons who bring timber or timber products to the EU market as well as on persons who

11

deal in the internal timber market. These obligations include a prohibition on placing illegally harvested wood or wood products on the market. Illegality of harvest would depend on the laws which are in place in the country of harvest (which may not be the country in which the timber is being traded).

LEGAL LOGGING

For the purpose of implementation of the FLEGT Action Plan, it is important to fi rst understand the meaning of legal logging. The Action Plan does not contain a fi xed given defi nitions of Legal (and Illegal) Logging. What is legal (or illegal) logging would depend on the laws of each country with which the EU has entered into a VPA. The laws of the Partner country which are applicable to entire supply chain – starting from harvesting the wood to the export of the timber or timber products – would have to be complied with. If any of the laws are violated, then the timber or timber product is illegal.

LEGALITY ASSURANCE SYSTEM

Each VPA that is entered into by the EU and a Partner country has to contain a Legality Assurance System (LAS). A LAS typically has fi ve components which are:

A LAS can be implemented through two types of licenses:

Shipment-based licenses

Each consignment of timber or timber products which is being exported to a EU member country is individually licensed by a Licensing Authority appointed by the Partner Country in accordance with the VPA. This license would only be awarded once the Licensing Authority has checked that the timber has been legally harvested.

THE SITUATION AND REGULATION OF THE SHIP BREAKING INDUSTRY

12

Operator-based licenses

These licenses are given to a particular operator, once the Licensing Authority has ascertained that the operator has in place a robust system to ensure legality of harvest. All consignments from this operator would be covered by the FLEGT license. The operator can rely on various systems including certifi cation schemes and wood tractingsystems to ensure that it meets the parameters of legality. The Licensing Authority has to periodically check that the operator’s systems are meeting the requirements of the LAS.

ADVANTAGES OF ENTERING INTO A FLEGT VPA

Some of the advantages which Partner countries can enjoy if they enter into FLEGT VPAs with the EU are as follows:

Political and fi nancial reinforcement of Government reforms aimed at improving forest governance

Improved access to EU markets, as public and private procurement policies increasingly specify the use of legal timber and the exclusion of unidentifi ed or illegal timber, since all imports to the EU will be considered legal;

Increased revenue from taxes and duties which, in some cases, may exceed the costs associated with running the licensing system;

Increased revenue to fi nance poverty reduction and community development programmes;

Priority for EU development assistance for FLEGT-related measures;

Additional enforcement tools to combat illegal activities;

A foundation framework which will facilitate private operators to progress to certifi cation of sustainable forest management3

3 FLEGT Briefi ng Notes - Briefi ng Note No. 6 – Voluntary Partnership Agreements (Series 2007) available at http://www.loggingoff.info/sites/loggingoff.info/fi les/ULD%20EU%20Briefi ng%20Note%20(2007)%206%20VPAs.pdf

13

PART III THE FOLLOWING ARE TABLES WHICH PROVIDE INFORMATION ABOUT LAWS AND ORDERS OF THE SUPREME COURT RELATING TO FORESTS AND FOREST PRODUCTS FOR THE THREE STATES OF KERALA, RAJASTHAN AND UTTAR PRADESH.

Stage inthe Supply Chain

Lacey Actcomponent

Applicable law Means of verifi cation

Forest Legal Right to Harvest

The following species are regulated under the Kerala Tree Preservation Act, 1986. Sandalwood (Santalum album), Teak (Tectona grandis), Rose-wood (Dalbergia latifolia), Irul (Xylia Xylocarpa), Thempavu (Terminalia tomantosa), Kampakam (Hopea parvifl ora), Chempakam (Mechelia hempaca), Chadachi (Grewia tiliaefolia), Chandana vempu (Cedrela toona), Cheeni (tetrameles nudifl ora).

Check whether prior approval has been obtained under Section 4 of the Kerala Tree Preservation Act, 1986

Transport Legality of Possession and Transport

Under Section3 of the Kerala Forest Produce Transit Rules the Import, export and transport of timber and other forest produce is regulated . The relevant part reads -(1)No person shall; import timber or other forest produce into the State; or export timber or other forest produce from the state; or transport timber or other forest produce by land, by rail or by water in any part of the State, unless such timber or other forest produce is accompanied by a pass required by these rules, and unless the timer is stamped by a Government stamp or a stamp registered as laid down in Rule 11.

Pass issued by the concerned authority and Stamp on the Timber

ILLUSTRATIVE CHART ON DOMESTIC LAWS, REGULATIONS AND POLICIES AND COMPLIANCE WITH LACEY ACT

KERALA

14

Export Any person desiring to export timber or other forest produce outside India shall obtain a clearance from the Divisional Forest Offi cer, or Assistant conservator of forests having jurisdiction over the area [3 (a) of the Kerala Forest Produce Transit Rules

Form No.11 from the DFO or ACF having jurisdiction over the area. The Kerala Transit Rules further state as follows:

4. Form and issue of passes.-

Export passes shall be printed on red paper and marked "Export way permit" and shall be issued by the Divisional Forest Offi cers or other offi cers auhorised in that behalf by the Chief Conservator of Forest on production of proof that the articles mentioned have been properly obtained.

Passes for timber and other forest produce belonging to the Government and purchased from Government land or from Government depot or elsewhere shall be printed on white paper and issued by the Range Offi cer or Depot Offi cer or by any other offi cer authorized in that behalf by the Chief Conservator off Forests. The validity of the passes issued under this clause, shall be subject to the conditions under which the sale of the produce was effected.Passes for timber and other forest produce collected from private lands shall be printed on yellow paper and be marked "Private". Such passes shall be issued by the Divisional Forest Offi cer or Forest Range Offi cer or by any other offi cer authorised by the Chief Conservator of Forest

No pass shall be required within the limits of Taliparamba, Cannanore, 6 (Kozhikode, Tirur, Ponnani, Perinthalmanna and Ottappalam Taluks; 7[Portions of Taluk lying west of koxhikode - Cannanore road;] portions of Badagara and Tellicherry Taluks ;lying west of Badagara - Tellicherry road; Badagara and Tellicherry Municipalities; and in the erstwhile Travancore - Cochin area the portion lying west of Shornur-Trichur Road and NH 47 upto Angamali; M.C. Road upto trivandrum East Fort and Trivandrum Cape-Comarian upto the State boundary at Parassala for the removal of timber species namely - Elavu, Kambli, Matti, Pala, Kanakaitha, Ambazham, Thodayam and Podipari.

15

Stage inthe Supply Chain

Lacey Actcomponent

Applicable law Means of verifi cation

Forest Legal Right to Harvest

The Act of felling of trees or removal of forest produce is not in violation of Section 26 of the Rajasthan Forest Act, 1953

The Rajasthan Tenancy Act, 1955 makes provisions for cutting trees, S83 reads:

"S83 - Tree not removable except as provided; Notwithstanding anything to the contrary in any law. Custom or contract, no tree standing on occupied or unoccupied land shall be removable therefrom except as provided in S84".Further, S84 provides:

2. A Khatedar tenant holding land below the ceiling limit may of his own accord remove trees standing on his holding for any purpose.

3. A Gair Khatedar tenant may, with the previous permission of the Tahsildar,remove any trees standing on his holding for his own domestic or agricultural use".

The Rule also makes provisions for felling trees planted on the allotted land. It provides that the allottee can cut a tree which has attained silvicultural maturity provided for every tree to be felled, he has two trees standing of 2 years growth. If he does not have two trees for one to be cut, he will have to take written permission of the Sub- Divisional Offi cer

Check whether approval from the competent Authority has been obtained.

The Competent Authority should be the Conservator of Forest or the Chief Conservator of Forest

Transport Legality of Possession and Transport

THE RAJASTHAN FOREST (PRODUCE TRANSIT) RULES,1957 regulates the transport of timber. It states the following :Removal of produce.- No forest produce shall be moved into or from or within any area in the State of Rajasthan except without a pass issued by a Forest Offi cer or person duly authorised by or under these rules or otherwise than in accordance with the conditions of such pass or by any route or to any destination other than the route and destination specifi ed in such pass;

(1) Check whether Pass has been issued.

The following offi cers and persons shall have the power to issue passes under these rules,namely-(a) Chief Conservator of Forests,

Rajasthan.(b) Conservator of Forests.(c) Divisional Forest Offi cer.(d) Sub-Divisional Forest Offi cer.(e) Persons specifi cally authorised

by the Government in this behalf by a notifi cation in the Rajasthan Rajpatra.

(2) Every pass issued under these rules shall contain the following particulars, namely –(a) Name of the person to whom the

pass is granted.(b) Quantity and description of forest

produce covered by it.(c) Name of the village, tehsil and

district in which the person resides.

(d) Place from and to which such forest produce is to be taken or conveyed.

(e) The route and the name of chowkies and nakas by which such forest produce is to be conveyed.

(f) The period for which the pass shall be valid.

1 Published in the Rajasthan Gazette, Pt.IV-C, dated 20th February, 1958

RAJASTHAN

16

Stage inthe Supply Chain

Lacey Actcomponent

Applicable law Means of verifi cation

Forest Legal Right to Harvest

All forests are managed under the prescriptions of a working plan/scheme prepared on the basis of principles of sustainable forest management and recognized and innovative silviculture practices. The authority as designated by the Ministry of Environment & Forests, Government of India, approves the working plan for this purpose. Generally no timber harvesting is done in any forest area without an approved working plan/scheme.

The National Working Plan Code has to be followed by each State Government and Union Territory for all categories of forests as defi ned by the Supreme Court in its judgement dated 12.12.1996. No commercial harvesting of any forest produce can take place unless it has been carried out under the prescriptions of a working plan/scheme approved by the Ministry of Environment & Forests through its Regional CCF. [National Working Plan Code, Para 92]

Copy of the Approval of the Working Plan of the concerned forest division from where the Timber has been procured.

Stage inthe Supply Chain

Lacey Actcomponent

Applicable law Means of verifi cation

Forest Legal Right to Harvest

Order dated 12.12.1996 of the Supreme Court –No wood can be sourced from the tropical evergreen forests of Tirap and Changla in the State of Arunachal Pradesh

Trees can only be felled in forest if it is in accordance with Working Plans of State Governments, as approved by the Central Government

States in which there are no working plans, but there are permits, felling under permit can be undertaken only by the State Forest Department or the State Forest Corporation

For the hill region of the State of Uttar Pradesh – trees are not permitted to be felled in the any forest, public or private. This ban does not affect felling in plantation comprising of trees planted in any area which is not a forest; State government can remove fallen trees or fell and remove diseased or dry standing timber from areas other than those notifi ed under the Wildlife (Protection) Act 1972, or any other Act banning such removal.

Check for Transit Permit andSource of Origin of Timber

NATIONAL WORKING PLAN CODE

NATIONAL WORKING PLAN CODE

17

Legal Right to Harvest

Order dated 15.01.1998 of the Supreme Court –With regard to north eastern states-

All forests will be worked according to approved working plans. Forests under the District, regional and village councils shall be worked in accordance with working schemes which shall specify the program for regeneration and harvesting.

Timber extracting in forests irrespective of ownership except in private plantation, shall be carried out by a State agency only.

Concessional timber provided to local tribals in ArunachalPradesh for bona fi de personal cannot be bartered or sold.

Order dated 12.07.2001 of the Supreme Court –NO movement of felled timber by natural causes or otherwisefrom Matheran, Maharashtra, shall be there and no sale thereof.

Order dated 18.02.2002 –Order prohibiting cutting of trees does not apply to bamboosincluding cane (which belongs to the grass family) except that which is in national parks and sanctuaries.

Order dated 07.05.2002 –With regard to Andaman and Nicobar islands-All felling of trees from the forest of Little Andaman Island,the national park and sanctuaries, the tribal reserves and all other areas shall stand suspended.

No felling of trees (under working plan or otherwise) shall be permitted for meeting any raw material requirements of the plywood, veneer, black board, match stick or any other wood based industry

Transport Order dated 12.12.1996 of the Supreme Court –There is a complete ban on the movement of cut trees and timber (or veneer) from any of the seven North eastern states either by rail, road or water ways.

Ban does not apply to certifi ed timber required for defence orany other government purpose.

Ban does not affect felling in any private plantation comprising of trees planted in any area which is not a forest

Order dated 15.01.1998 of the Supreme Court –With regard to North eastern states - Transportation of auctioned timber outsider the north eastern region shall only be done through railways under the strict supervision of the Forest Department.

Order dated 12.05.2001 of the Supreme Court –With regard to North eastern states - Movement of timber products including sawn timber, veneer and plywood outside North East shall be permitted only if sourced from or processed in HPC-cleared wood based unit situated inside an approved industrial estate except in case of Mizoram where no industrial estates exist. Round and hand sawn timber shall not be allowed to be transported outside the North East except with prior approval of HPC or Ministry of Environment and Forests.

‘Transit passes’ (T.P.s) printed only on water marked paper shall be used for the transportation of timber/ timber products with effect from the date to be fi xed by the Ministry of Environment and Forests, which shall not be later than01.12.2001.

Transit Passes should be issued in Water Marked Papers for Timber coming from the North East.

Timber to be procured only from areas were approved Working Plans exists.

18

Processing Legality of processing

Order dated 12.12.1996 of the Supreme Court –Non- forest activities including running of saw mills, veneer or plywood industries cannot take place inside forests as defi ned by the Court

No saw mill, veneer or plywood industry can be based in Tirap and Changlang in Arunachal Pradesh and within a distance of 100 km from its border in Assam.

Order dated 29.10.2002 of the Supreme Court –No Sawmills, plywood and veneer units to function without license; no such unit can be opened without the permission of the Central Empowered Committee.

Order dated 18.05.2007 of the Supreme Court – Sawmills, plywood and veneer units can be permitted to function with wood sourced from trees which are outside forest area and from government forests.

Order dated 15.01.1998 of the Supreme Court –With regard to the North eastern states –

Wood-based Industries which have been cleared by the High Powered Committee can operate and will be allotted timber only if they are located within the industrial estates notifi ed by the State Governments.

Licenses for all wood based industries are suspended. Only industries which have been granted license by the High Powered Committee can operate. Licenses of the units will be renewed annually only in cases where no irregularity has been detected.

License issued by the State-levelCommittee

In North Eastern States, the wood should be procured from units located at approved industrial estates

19