Expert Council: A Challenging Start

WhatWood attended the first meeting of the Forest Industry Expert Council at State Duma on Friday, April 19. The main topic at the event was draft law on control and inventory of roundwood trade to fight illegal logging. The positions of its participants were clear from the very beginning: industry players consider this law as very untimely, while officials regard its approval as pre-determined (“Russian leaders have set the goal, so we have to admit it and work with what we’ve got”), although agreed with some critic remarks.

The head of forest management and regeneration at the Federal Forestry Agency Alexander Mariev made an introductory report. He said the unified information system introduced by the draft law will reduce the volume of illegal logging and simplify paperwork, as the only printed document for the logging company will be delivery note.

The information system will automatically store all the data on log consignments throughout the whole supply chain: logging company, volume, specifications and species. Valuable species (oak, beech and ash) will be marked single-piece. It is proposed to impose monitoring functions on the traffic police. They will be in position to stop timber trucks, check the declaration in the database and verify the species composition of the consignment. However, the matter of controlling authority still remains open.

At the regional level, laws on logging control have been operating in many Russian republics and regions. Alexander Mariev cited the example of Bashkortostan, which has a strict law: each timber truck is declared separately (in a free form: by a call to the dispatcher, by fax or by email). According to Mariev, the situation reached the point that truck drivers are convincing dispatchers by themselves: “Until you call the consignment owner and acknowledge that I’m carrying legally logged wood, I’m not moving anywhere”. Mariev notes that all wood flows in the region have become legal and within three years the volume of violations decreased manifold. During the season of low fire hazard web cameras in Bashkortostan forests are transferred to main crossroads, which also helps to fight illegal logging.

Forestry Department of Tomsk region, meanwhile, reported last week that the recent regulation on registering logging sites was fulfilled by only half of the companies, despite minimal requirements to register.

It is to note also that in Irkutsk region sawmills flooded the regional ministry of industrial policy and forest industry with declarations, so by autumn 2013 the ministry intends to switch fully to electronic declarations.

Timber merchants and scientists have not shared the enthusiasm of the Forestry Agency top official and attacked back almost immediately: in their view, this bill will create a lot of new problems and unnecessary paperwork, while its main goal, fighting illegal logging, will not be reached.

“This law will hinder only official loggers, while illegal ones will just go on. Now we are even measuring export-grade birch wood from two sides, just in case, so that the customs couldn’t penalize us”, reacted one of the loggers.

“There is a feeling that we are back to logging permits – with huge number of agencies involved and the logging becoming permissive rather than declarative”, said Department Head at the St. Petersburg Forestry University, Professor Vladimir Petrov, who is known as a consistent advocate of private property for forestland in Russia.

Rector of the Institute for Advanced Training in Forestry Anatoly Petrov supported his colleague: “This is purely a paper project, it does not take into account the economic provisions of the Forest Code”.

“Permissive nature of this bill is a tough position of the Ministry for Economic Development”, complained Mariev, triggering protests from Vladimir Petrov and other scientists.

“It is essential to compare this law with international practice”, intervened Anatoly Shuvalov, who represented the Chamber of Commerce. “In other countries, there are tough regulations: Lacey Act in the U.S., laws in Indonesia and Malaysia, the recent EUTR regulation of the European Union. Note that these countries have a great system of voluntary certification, but the regulations are strict anyway”.

“I’m sorry, but the fact that the Ministry of Economy does not want to compromise is not a reasonable point in the argument”, said member of the Academy of Sciences, professor of Moscow State Forestry University Nikolai Moiseev. According to him, the new law will return the industry back to pre-revolutionary system, when the forester gave logging permits and waybills to loggers. “But even if so, it is necessary to include not only the volume and specifications, but also the value of the consignment in the delivery note”, Moiseev concluded. In his opinion, it is the only way to relate delivery with the fact of payment, with particular transaction and buyer, and hence fight illegal logging.

One of the articles of the draft law brings woodworking beyond the framework of its effect. Unskilled consumers that buy out any timber without looking at the source of origin do not bear any responsibility. Businessmen have proposed an amendment identical to the Lacey Act, so that the buyer and the seller send reports independently and the system then compare automatically the volumes. However, sanctions for buyers of illegal timber are still out of question. As noted by Alexander Mariev, “we’ll grow into it in probably ten years”.

Entrepreneurs came up with another important amendment: in order to fight illegal loggers it is reasonable to regulate the first section of the supply chain, i.e. from the stump to the lower landing. In response, Anatoly Shuvalov suggested that they convince the president: “He’s already said that it is essential to control the whole chain, everyone tells him about illegal cutting. Try to convince him!”

“In contrast to the Chamber of Commerce, the Russian Union of Industrialists and Entrepreneurs does not support the adoption of this law. We can’t approve it without statutory instruments. We have not seen even the declaration form so far”, said Deputy CEO, GR of Ilim Group Vladimir Slavutsky.

The heat of the debate was growing. Loggers and manufacturers defended emotionally their amendments to the bill and gradually spread their critic remarks to the necessity of this law itself and even reasonability of the Forest Code. Officials tried to turn the discussion into a different direction: to admit that the law will be accepted in any case and focus on particular amendments. Finally, the head of the Council Vyacheslav Pozgalyov noted that the agenda had begun to expand infinitely, and directly opposing proposals are coming, from approving the law without cuts to the revision of the whole Forest Code. “Dear colleagues, we have to get out of this discussion and work on the law, especially after we accumulated so many amendments. The Council was established to this very purpose, and we actually have a legal right to make suggestions for Forestry Agency and State Duma. I invite you all to send comments to Alexander Mariev, and he would take it into account so that we can return to the discussion at the next meeting”, head of the Council said.

“Businessmen today have sent multiple signals that this law will be a burden – and yet there are only big companies there, small ones will feel much worse. (…) My opinion is that this bill won’t work in its current form”, Vladimir Petrov concluded. “By not recognizing the mistake to abolish the logging permit, the state avoids responsibility. Let’s at least acknowledge this mistake, and for the sake of continuity just denote clearly that the current bill is the same thing as logging permits, in order to relieve suspicion of the business”.

“It’s the small and medium companies that steal most of the wood. Control of logging is not a burden for the business, but rather a responsibility. Can you imagine what would happen if nobody controls logging? They’ll just buy outright a forester”, Pozgalyov countered. According to the head of the Council, this law is a step towards extinguishing paperwork, but first the industry will have to go through a transition period.

At this point, the Expert Council finished the meeting. It should be noted that the agenda contained the matter of quotas on softwood logs export, but it was not regarded.

The next meeting will be held in June. It is quite possible that severe controversy over this federal law will be resolved – if scientists and businessmen remain cool-headed and defend numerous amendments and clarifications in a dispute with Forestry Agency, while officials do not respond to this criticism with purely technical revisions. However, complete cancellation of this bill in favor of other methods to fight illegal logging and admitting this draft law as a mistake (as insisted by many members of the Expert Council) seems almost impossible now, even if the Forestry Agency suddenly supports these steps. Current Russia’s top officials rarely reconsider their decisions, no matter how erroneous they may be.

Kirill Baranov