Bulldozer clearing Chaco forest in Paraguay, December 2019
Embargoed to 14.01 CET on 12.11.2024
- Companies and individuals whose businesses would be affected by an anti-deforestation supply chain law have provided over €1.7 million since 2018 to European political parties that are trying to gut the law
- Members of Austria’s ÖVP and Germany’s CDU have pushed for the EU Deforestation Regulation (EUDR), which would curb trade in commodities produced from deforestation, to be delayed and watered down. These two parties are part of the EPP – the most powerful voting bloc within the European Parliament – which has proposed amendments that would dramatically weaken the law
- The CDU has received donations from car company Mercedes-Benz and the major shareholders in BMW, both of which have been linked to illegal deforestation in their leather supply chains
- The ÖVP and related organisations have received sponsorship or advertising payments from branches of supermarket chains Spar, Adeg, and Metro, furniture giant XXXLutz and the Raiffeisen Banking Group, all of which are exposed to forest-risk commodities
- The European Parliament is set to vote on 14 November 2024 on proposals to delay and weaken the EUDR, which is vital to protecting the world’s remaining forests
UK investigative NGO Earthsight has released new analysis that finds that two European political parties have received over €1.7 million since 2018 from companies trading in forest-risk commodities, and their major shareholders. Members of Austria’s Österreichische Volkspartei (ÖVP) and Germany’s Christlich Demokratische Union Deutschlands (CDU) have in turn pushed to delay and water down a law aimed at removing deforestation from European supply chains.
This Thursday, 14 November 2024, Members of the European Parliament will meet to vote on proposals to delay and weaken the EUDR, which bans the import or trade within Europe of palm oil, beef, leather, cocoa, coffee, soy, rubber and timber produced illegally or on land deforested after 2020. The proposals from the European People’s Party (of which the ÖVP and CDU are members) include exempting large downstream traders (such as retailers and supermarkets) from most due diligence and creating a loophole for products from countries with “insignificant risk” of deforestation. Our analysis suggests this could lead to laundering of high-risk commodities and make the law much harder to enforce.
Earthsight’s analysis of the ÖVP’s political donations reveals that the party has received more than €600,000 since 2018 from companies whose businesses would be affected by the EUDR – and their shareholders. In Germany, the CDU has received more than €1.1 million in donation payments from such interests.
Earthsight Policy and Communications Lead Fyfe Strachan said: “The EPP’s proposed changes to the EUDR are nothing more than a series of loopholes that will make the law dramatically harder to enforce. De-fanging the EUDR in this way is likely to benefit a number of political donors to its member parties ÖVP and CDU. We urge both parties to put the interests of millions of people dependent on the world’s forests ahead of the interests of their political donors in this week’s vote on the EUDR.”
Donations to the ÖVP include €45,000 in 2018 from global trading group PISEC Group GmbH. Earthsight has found evidence of PISEC buying Ukrainian timber banned from export that appears to have been mis-declared as fuelwood.
ÖVP also received a donation from MHA Müller Handels GmbH, a large retail chain selling a range of products covered by the EUDR. Raiffeisen Ware, a wholesale business that uses imported timber and soy, provided sponsorship to the party via the Austrian Young Farmers association.
Between 2018 and 2021, the party received more than €356,000 in sponsorship, advertising payments and donations to related organisations from different arms of the Raiffeisen Banking Group. The banking group is a creditor, shareholder and bondholder of global grain trader Bunge, which has a well-established reputation for sourcing soy from lands linked to illegal deforestation. Raiffeisen also has reported financing links to Russia’s timber industry. In a response to Earthsight Raiffeisen emphasised that its sponsorship and advertising payments do not constitute political donations. Nonetheless, they are reportable to the Austrian government.
The ÖVP has also received over €100,000 for placing advertisements in party-owned publications from companies selling goods covered by the EUDR. This included payments from supermarket chains Adeg, Metro Cash & Carry and Spar and from furniture retailer XXXLutz.
The CDU has in turn received €1 million in donations since 2018 from the two largest shareholders in car company BMW. Mercedes-Benz also donated €100,000 to the CDU in 2018 (on top of over €3 million in donations since 2001). A documentary aired by German broadcaster ARD in March 2024 linked leather car seats used by German automakers – including BMW – to cattle-driven deforestation in the Amazon. In 2020, Earthsight traced leather from illegally cleared forests in Paraguay to major European car manufacturers, including BMW. BMW has denied any links to illegalities in its Paraguayan leather supply chains. The Environmental Investigation Agency has traced cattle from farms with illegal Amazon deforestation to companies with supply chain links to Mercedes.
The CDU has also benefited from donations from the CITTI group of companies, which owns a chain of grocery stores selling chocolate, coffee and South American beef, and the PHW Group, a poultry producer which sources soy from Brazil as part of its chicken feed.
Ms Strachan said: “If political parties take payments from the companies they regulate, it is their responsibility to show that these payments do not influence their decisions. With European consumption responsible for the loss of 2,300 sq km of forest each year – or a football field every minute – European politicians cannot afford to be distracted by self-interest from the vital task of ending Europe’s complicity in deforestation.”
Responses from companies named are available in full here.
Notes to editors
The full article will be available here at 14:01 CET on 12 November 2024.
Earthsight is a London-based non-profit committed to exposing environmental and social crime and their links to global consumption.
Contacts
Earthsight Policy and Communications Lead Fyfe Strachan (EN)
Earthsight Deputy Director Rubens Carvalho (EN, PT, ES)
Earthsight’s funding comes from charitable foundations and government programmes. We are an independent, non-partisan organisation and our work is not influenced by government or private sector interests.
