This media backgrounder provides journalists with information on the Liberia-EU Voluntary Partnership Agreement, which aims to address illegal logging, improve forest governance and promote trade in legal timber products. The backgrounder explains the aims of the VPA, progress to date and next steps.
The Liberia-EU Voluntary Partnership Agreement
The forest sector in Liberia
Forests are important contributors to Liberia’s formal and informal economies. For many communities, forests are critical to livelihoods but major drivers of deforestation include slash-and-burn agriculture, charcoal production and artisanal logging.
During Liberia's civil war in the 1990s and early 2000s, timber revenues were misappropriated and used to sustain the conflict. As a result, in 2003, the UN Security Council imposed sanctions on timber exports from Liberia. The UN lifted sanctions in 2006, but poor forest governance remains a major contributor to deforestation.
China is now the main importer of Liberian timber, but both Liberia and the EU expect that VPA implementation will strengthen the standing of Liberian timber products on the EU market.
What is a VPA?
A Voluntary Partnership Agreement (VPA) is a legally binding trade agreement between the EU and a timber-exporting country outside the EU. A VPA aims to ensure that all timber and timber products destined for the EU market from a partner country comply with the laws of that country.
In addition to promoting trade in legal timber, VPAs address the causes of illegality by improving forest governance and law enforcement. A major strength of VPAs is that they look beyond trade to consider development and environmental issues.
Stakeholders in government, the private sector and civil society develop VPAs through a participatory process. A VPA is, therefore, a vehicle for addressing the needs of different stakeholders and for including many people who have never before had a voice in decision-making.
VPAs are a key component of the EU Forest Law Enforcement, Governance and Trade (FLEGT) Action Plan of 2003. Liberia is one of six tropical countries that have ratified and are implementing VPAs. Nine more are negotiating VPAs with the EU, while others have expressed interest in negotiating a VPA.
How a VPA promotes legal timber trade
A VPA partner country that has implemented a timber legality assurance system and other VPA commitments can issue verified legal timber products with FLEGT licences. The advantage of this is that FLEGT-licensed products automatically meet the requirements of the EU Timber Regulation (EUTR), which prohibits EU operators from placing illegally harvested timber and timber products on the EU market.
The EUTR entered into force in 2013. It requires EU operators to perform due diligence checks to ensure the timber products they place on the EU market are legal. FLEGT-licensed timber meets the due diligence requirements under the EUTR.
A VPA partner country can only issue FLEGT licences through a timber legality assurance system that the EU and the partner country have agreed on, developed and tested. Before a country can begin FLEGT licensing, the EU and the partner country must confirm that the country’s timber legality assurance system works as described in the VPA. Confirmation by the two parties means that the system is robust and will issue FLEGT licences only to legal timber products.
While FLEGT licensing is an important goal, it is not the end point of a VPA process. Governance reforms, legislative and policy reforms, impact monitoring, improvements to the timber legality assurance system and other activities continue.
Through progress on VPAs, the EU Timber Regulation and dialogues with other important timber markets, including China, the EU and the VPA partner countries are contributing to a growing global movement to address trade in illegal timber and timber products. The United States and Australia also prohibit the placing of illegal timber on their markets. The process to achieve FLEGT licences may therefore help VPA partner countries such as Liberia meet the legality requirements of markets beyond the EU.
LTTC forest concession, River Cess County, Liberia
After logs have been felled and skidded out of the forest, workers cut, scale and re-tag them.
Source: Flore de Preneuf, PROFOR
The Liberia-EU VPA
The Liberia-EU Voluntary Partnership Agreement (VPA) is a legally binding trade agreement. It aims to ensure that Liberia produces and exports only legal timber and timber products by improving forest governance and law enforcement.
Although VPAs are primarily concerned with international trade, Liberia decided to include the production of timber for the domestic market in its agreement, including informal activities such as chainsaw logging.
Liberia and the EU negotiated the terms of the VPA through a cooperative process: both parties share the goals of eliminating illegality and fostering good forest governance.
VPA negotiations started in March 2009. The negotiations involved representatives of Liberian civil society organisations, community organisations, the private sector, and government ministries and agencies. As a result, significant national ownership and stakeholder engagement were achieved and the VPA reflects a broad consensus among stakeholders.
The negotiations concluded in May 2011. The EU ratified the VPA in May 2012 and Liberia did so in December 2013. Liberia and the EU are now implementing the commitments laid out in the VPA text and annexes [PDF].
Liberia commits to developing a timber legality assurance system so it can issue verified legal timber products with FLEGT licences. Once this system is operational, Liberia commits to export to the EU only FLEGT-licensed timber products.
Before FLEGT licensing can begin, however, the EU and Liberia must confirm that Liberia’s timber legality assurance system is working and meets the requirements set out in the VPA, through a joint evaluation of the system. The joint evaluation must satisfy the Liberia-EU Joint Implementation Committee that the system is ready to issue FLEGT licences, meaning the system is robust and credible enough to ensure it licenses only legal products.
Liberia also commits to implementing legal reforms, publicly disclosing information about the forest sector and making other improvements to forest governance. The EU and Liberia jointly commit to monitor the social, economic and environmental effects of the agreement.
The timber legality assurance system, governance reforms and other commitments are described in the VPA’s main text and annexes [PDF]. In addition to the agreed commitments, the VPA process itself has fostered multistakeholder participation, transparency, legislative clarity, legal reforms and other aspects of good governance (see How the Liberia-EU VPA has improved forest governance).
A Liberia-EU Joint Implementation Committee oversees implementation of the VPA. Records of discussions are made public. The Liberian team includes representatives of government, civil society and the private sector. At the national level, the Forestry Development Authority coordinates implementation.
The VPA includes a framework for overseeing, monitoring and evaluating implementation of the VPA and its economic, social and environmental impacts.
Liberia’s efforts to tackle illegal logging
Liberia has made considerable efforts to address illegal logging since 2006 when the UN ended sanctions on timber exports. Efforts have included a comprehensive review of the regulatory framework, and the development of a national timber traceability system to track timber production and collect revenues. Liberia was also the first country to include timber revenues under the Extractive Industries Transparency Initiative.
- 1990s: Illegal logging rampant during Liberia’s prolonged civil war
- 2003: UN Security Council imposes sanctions on all timber exports from Liberia
- 2006: Liberia enacts the National Forestry Reform Law
- 2006: UN lifts sanctions, opening the way for Liberia to rebuild its forest sector
- 2008: Liberia becomes the first African country to achieve Extractive Industries Transparency Initiative compliance, including on timber revenues
- 2009: EU and Liberia begin negotiating a VPA
- 2011: EU and Liberia agree and sign the VPA
- 2012: The EU ratifies the VPA
- 2013: Liberia ratifies the VPA
- 2014: First meeting of the Liberia-EU Joint Implementation Committee
- 2015: Second meeting of the Liberia-EU Joint Implementation Committee
- 2016: Third and fourth meetings of the Liberia-EU Joint Implementation Committee
- 2017: Fifth meeting of the Liberia-EU Joint Implementation Committee
Source: EU FLEGT Facility
Liberia’s timber legality assurance system
Under the VPA, Liberia committed to develop a rigorous yet practical system for assuring the legality of its timber, through an inclusive multistakeholder process. The timber legality assurance system described in the Liberia-EU VPA has five components:
- Legality definition: The legality definition states the aspects of Liberia’s law for which the timber legality assurance system evaluates compliance with for purposes of FLEGT licensing. The legality definition applies all along the timber supply chain and to timber products from all types of forest
- Supply chain controls: Supply chain controls ensures that timber products verified as legal remain legal throughout all processes associated with the supply chain. Supply chain controls also prevent verified legal products being tainted by unverified products entering the supply chain. Liberia already had chain of custody controls in place to trace timber from its tree of origin to the point of export when it began VPA negotiations. The VPA builds on those controls
- Verification of compliance: Verification of compliance involves checks that all the requirements of the VPA legality definition and supply chain controls have been met to ensure that timber products are legal
- FLEGT licensing: A FLEGT licensing authority issues FLEGT licences to consignments of timber products that the verification mechanism has confirmed are legally compliant. FLEGT licensing cannot begin until a joint evaluation of the timber legality assurance system by Liberia and the EU confirms that the system works as described in the VPA (see Next steps)
- Independent audit: The independent audit regularly checks that all aspects of the legality assurance system work properly. An annex to the VPA provides terms of reference for the auditor. The auditor produces reports for the Joint Implementation Committee and the public.
Liberia has established two new departments within the Forestry Development Authority to manage the timber legality assurance system and licensing. The Forestry Development Authority is currently developing the timber legality assurance system and strengthening capacity in the two new departments. An external service provider has a five-year contract to strengthen the new Liberia Verification Department.
How the Liberia-EU VPA has improved forest governance
The VPA has already had a positive impact, both as a result of what Liberia and the EU have committed to, and as a result of the multistakeholder process of negotiating and implementing the agreement.
Greater participation in decision-making
The level of stakeholder participation in the VPA process is unprecedented. During VPA negotiations, representatives of civil society, local communities and the private sector participated alongside government representatives. These stakeholder groups are also represented in the national multistakeholder monitoring committee and the Liberia-EU Joint Implementation Committee.
Enhanced capacity to address illegal logging
The VPA process has strengthened the capacity of government, the private sector and civil society stakeholders to work together to address illegality in Liberia’s forest sector. Capacity building activities have included training to enable:
- The Liberian Forestry Development Authority to take over management of the legality assurance system
- The Liberian private sector to comply with all relevant regulations, including forest management plans, the Liberia Code of Harvesting Practices, and social and environmental protection legislation
- Civil society and community representatives to engage in negotiations and to participate in the Joint Implementation Committee.
An annex to the VPA lists the information that the Government of Liberia commits to make publicly available. The VPA recognises a role for civil society groups as independent forest monitors. Information released in relation to the VPA has already led to pro-poor changes in the way Liberia allocates permits to exploit private or community forests.
The VPA process has made what legality in the forest sector means in Liberia much clearer. The VPA legality definition describes what operators in the timber sector need to do to comply with the law, and the indicators and verification measures auditors will use to assess legality. Clear legislation makes it easier for the appropriate government agencies to enforce the law and for the justice system to prosecute illegal loggers.
Stakeholders are using VPA platforms to address gaps in regulations and harmonise the current legal framework. The Liberia-EU Joint Implementation Committee has agreed a clear process and a timetable for reforms, to enable effective stakeholder participation.
Measures covering the domestic market
Liberia has decided to include timber in the domestic market under the VPA. This will require significant further consultations with stakeholders as to how regulations around activities, such as chainsaw logging, could apply in practice. Domestic market measures will be phased in after a timber legality assurance system has been established for exports.
The Liberia-EU VPA process has been unique in that representatives of forest communities had seats on the national steering committee, which coordinated stakeholder input to the VPA negotiations. Representatives of forest communities could speak on their own behalf instead of relying on civil society to speak for them. Partly as a result of this, all stakeholders have expressed support for the agreement and are engaging with the implementation process.
Equity and benefit sharing
The Liberian national forestry reform law (2006) contains provisions establishing communities’ rights to a share of certain revenue streams from the forest sector. For example, communities are entitled to 30% of the Land Rental Fees paid by logging companies, as well as fees per cubic metre of timber harvested within their community.
By 2013, however, none of the communities had received a share of the Land Rental Fees, despite raising the issue in various fora. After Liberia ratified the VPA in 2013, community representative on the Joint Implementation Committee raised their concerns. The government agreed to redistribute the community share of funds to the National Benefit Sharing Trust, as foreseen in the national forestry reform law. The Government of Liberia has now paid the first US$1 million into the trust.
This first transfer of Land Rental Fees to the trust is widely seen as an important success for the VPA. In 2016, the trust made the first transfers of funds to forest communities, based on their proposals for community projects. The trust’s board is chaired by an NGO coalition and its members include representatives of communities and government.
How the Liberia-EU VPA strengthens accountability and the rule of law
In 2010, Liberian civil society organisations grew concerned about a steep increase in the government’s allocation of logging permits, known as private use permits, which allow companies to clear privately-owned land. Compared with other permits, private use permits have fewer sustainability restrictions and lower fees.
By 2012, Liberia had used private use permits to allocate 40% of its forested land to loggers, an area half the size of Switzerland. This threatened the future of Liberia’s forests. Civil society groups contended, however, that many of these permits appeared to be based on forged documents and were granted in dubious circumstances, without the informed consent of the communities that own the land.
The VPA process gave Liberian civil society an opportunity to challenge the allocation of such permits. In response, in 2012, Liberia placed a moratorium on issuing new private use permits and suspended the felling or export of logs under the permits already granted. Several forestry officials are now standing trial for their roles in the affair. Never before in Liberia have forestry officials faced court proceedings for forest crimes.
Some logging companies are now looking to agree Community Forest Management Agreements (CFMAs), which independent forest monitors from civil society will observe.
The Forestry Development Authority has received more than 120 CFMA applications, but will not approve any until the process of harmonising laws and regulations has been agreed in the Joint Implementation Committee and the allocation process has been further clarified.
Head office of the chainsaw union, Liberia
Source: Flore de Preneuf, PROFOR
Develop the timber legality assurance system
With support from an external service provider, Liberia is developing its timber legality assurance system and setting up a new Legality Verification Department in the Forestry Development Authority.
Liberia is also developing LiberTrace, a system to manage data on the chain of custody and legality verification. Government agencies and forest sector companies will both use the system.
The Government of Liberia, together with representatives from other stakeholder groups, has taken stock of the current chain of custody system. Findings will feed into the development of the new system and address ongoing issues, such as how to deal with non-compliance.
Begin trading in FLEGT-licensed timber
When a joint EU-Liberia evaluation concludes that the Liberian timber legality assurance system is fully operational as described in the VPA, the Joint Implementation Committee can propose that Liberia begins to issue FLEGT licences. Once a decision is made to commence FLEGT licensing, the parties will follow their respective internal processes, including legislative measures, such as amending the FLEGT Regulation on the EU side.
Once FLEGT licensing begins, a valid FLEGT licence must accompany all exports to the EU of Liberian timber-based products listed in Annex I of the VPA. EU customs officials will deny entry to any products covered by the VPA that arrive without a valid FLEGT licence.
The chain of custody system used by Liberia since 2008 already requires exported timber to meet traceability requirements and basic legal requirements, such as payment of taxes. Currently, timber can only be exported if it meets these requirements.
Undertake further reform
Once the timber legality assurance system for the export market has been agreed, stakeholders will discuss how to regulate and monitor the domestic timber market.
The EU and Liberia have made a joint commitment to monitor the social, economic and environmental effects of the agreement. Monitoring will consider whether the VPA is having the desired outcomes. It will also identify unintended negative effects for the EU and Liberia to address and mitigate.
Independent market monitoring
The European Commission has appointed the International Tropical Timber Organization (ITTO) as an independent market monitor for all VPA countries. ITTO will assess the trade in timber products between Liberia and the EU, and the impacts of FLEGT licensing on this trade.