Washington, DC – United States Trade Representative Robert Lighthizer today directed the United States Customs and Border Protection (CBP) to block future timber imports from Inversiones WCA E.I.R.L. (WCA), a Peruvian exporter, based on illegally harvested timber found in its supply chain. This marks the second time that the Trump Administration has taken such an enforcement action under the United States – Peru Trade Promotion Agreement’s (PTPA) Annex on Forest Sector Governance (Forest Annex), demonstrating its intensified efforts to keep illegal timber out of the United States.
This action is being taken by the Interagency Committee on Trade in Timber Products from Peru (Timber Committee). Further, it is the result of a request that the Timber Committee made to Peru in February 2018 to verify that three specific timber shipments from Peru to the United States complied with all applicable Peruvian laws and regulations. The request was made in the context of continued concerns about the practice of illegal logging in Peru. The timber verification process was conducted by the Government of Peru and revealed that one shipment from WCA was not harvested and traded in compliance with Peru’s laws, regulations, and other measures. Since the completion of the report in July 2018, Peru has failed to take enforcement action against WCA.
“President Trump is committed to ensuring that our trading partners live up to their obligations,” said Ambassador Lighthizer. “Peru must increase its efforts to combat illegal logging. The United States is doing our part by enforcing our trade agreement and ensuring that illegally-harvested timber cannot be exported to our country.”
The PTPA contains a unique Environment Chapter and Forest Annex, which includes a requirement for Peru to conduct audits of particular timber producers and exporters, and upon request from the United States, perform verifications of particular shipments of wood products from Peru. Further, the Agreement provides an illustrative list of actions the United States may take with respect to the shipment or enterprise that is the subject of the verification. Based on the results of Peru’s verification and ongoing monitoring of the situation, the Timber Committee has directed that CBP deny entry to products and exports of WCA for three years, or until the Timber Committee determines that WCA has complied with all applicable laws, regulations, and other measures of Peru governing the harvest of and trade in timber products, whichever is shorter.
In October 2017, the Trump Administration took a similar action to deny entry of timber products and exports by another Peruvian company, Inversiones Oroza (Oroza), after Peru was unable to verify that the shipment subject to investigation under the PTPA complied with all applicable Peruvian laws and regulations. The CBP denial of entry order against Oroza is still in force. In order to enhance implementation of the Oroza and WCA denial of entry orders, USTR has requested that CBP conduct additional due diligence to better identify and deny entry of products and exports of both companies prior to entry into the United States.
While the Forest Annex has catalyzed meaningful reforms in Peru’s forestry sector, the verification process has repeatedly highlighted the systemic challenges that remain in combatting illegal logging in Peru. In November 2016, the Government of Peru announced a set of unilateral actions to address ongoing challenges, including holding all of the relevant actors involved in illegal logging accountable, amending export documentation requirements to improve traceability, enhancing timber inspections, and implementing a timber tracking system in the Amazon corridor. However, significant work remains for Peru to address its ongoing challenges to combat illegal logging. The United States and Peru continue to engage in a cooperative and meaningful way to combat illegal logging and work towards improving forest sector governance. USTR and the Timber Committee will continue to monitor closely Peru’s implementation of the commitments in the Environment Chapter.
For additional information on the PTPA Forest Annex, please click here.