Overview
Title
To combat illegal deforestation by prohibiting the importation of products made wholly or in part of certain commodities produced on land undergoing illegal deforestation, and for other purposes.
ELI5 AI
The FOREST Act of 2023 is a rule that helps protect trees by stopping certain products from coming into the U.S. if they are made from ingredients grown on land where trees were cut down illegally. It also encourages companies to be honest about where their stuff comes from and gives penalties to help other countries stop illegal tree-cutting too.
Summary AI
The FOREST Act of 2023 aims to combat illegal deforestation by banning imports into the U.S. of products made from commodities grown on illegally deforested land. The bill mandates import declarations to ensure products are legally sourced and calls for closer monitoring of supply chains. It establishes penalties for violations and creates funds through these penalties to assist foreign governments in stopping illegal deforestation. The Act also provides procurement incentives for U.S. government suppliers to avoid deforestation-related commodities in their supply chains.
Published
Keywords AI
Sources
Bill Statistics
Size
Language
Complexity
AnalysisAI
General Summary of the Bill
The bill titled "Fostering Overseas Rule of Law and Environmentally Sound Trade Act of 2023," or the "FOREST Act of 2023," aims to address illegal deforestation by prohibiting the importation of commodities produced on illegally deforested land into the United States. The proposed legislation outlines measures for tracing the origins of imported goods, ensuring supply chain transparency, and establishing a system of audits and enforcement to prevent these products from entering the U.S. market. Additionally, the bill proposes support for international efforts to curb deforestation, enforcement of already existing laws like the Lacey Act for pulp and paper products, and incentives for U.S. companies with environmentally responsible procurement policies.
Summary of Significant Issues
The bill raises several significant issues:
Vague Definitions and Requirements: Terms such as "reasonable care," "sufficient information," and "wholly or in part" are not clearly defined, potentially leading to inconsistencies in enforcement and compliance challenges. This vagueness could cause confusion among importers attempting to adhere to the law.
Potential Bias Towards Larger Corporations: The establishment of a Trusted Trader Program could favor larger businesses that have the resources to implement comprehensive compliance systems, potentially disadvantaging smaller importers who may struggle to meet these requirements.
Administrative Burdens: The extensive requirements for supply chain traceability and transparency might impose significant administrative tasks on companies, particularly smaller ones, potentially impacting their competitiveness and economic efficiency.
Privacy and Confidentiality Concerns: The requirement to make certain import declaration data publicly accessible could inadvertently expose sensitive business information, raising privacy concerns.
International Cooperation Challenges: The bill outlines complex collaboration between various federal agencies and foreign governments, which could lead to bureaucratic inefficiencies and diplomatic challenges, potentially hindering effective international cooperation.
Impact on the Public
Broadly, the bill aims to mitigate environmental degradation linked to illegal deforestation by controlling what enters the U.S. market. If implemented effectively, it could lead to a reduction in deforestation rates and the associated environmental impacts, benefiting global biodiversity and efforts to combat climate change.
However, the administrative cost and complexity involved in complying with the new regulations could contribute to higher prices for imported goods, impacting consumers. The efficiency of the bill's implementation, especially related to the regulation's complexity and the coordination required between agencies and countries, will significantly determine its overall impact on the public.
Impact on Specific Stakeholders
Environmental Groups and Advocates: The bill is likely to be positively received by environmental groups, as it aligns with efforts to combat climate change and protect biodiversity by controlling deforestation-related imports.
Importers and Businesses: Small and medium-sized enterprises could face challenges due to the administrative complexities and resource requirements involved in compliance, potentially impacting their competitiveness. On the other hand, larger companies might benefit from the Trusted Trader Program if they can leverage it effectively to streamline their import processes.
International Stakeholders: Countries involved in exports affected by this legislation might face economic impacts unless they implement compliance measures to curb illegal deforestation. For those that choose to comply, the bill could act as an incentive to enforce stricter environmental protections, although the requirement for action plans and international cooperation could present diplomatic challenges.
Experts and Lawmakers: Policymakers and regulators will need to address the ambiguities and administrative burdens identified in the bill to ensure it is effective and fair for all stakeholders. The success of the legislation will depend on their ability to refine its provisions to minimize the potential economic and competitive downsides.
Financial Assessment
The FOREST Act of 2023 includes several financial references that highlight both potential benefits and challenges associated with the bill's implementation and enforcement.
Financial Allocations and Spending
The bill addresses illegal deforestation by establishing a fund in the U.S. Treasury, composed of amounts equivalent to penalties collected under the act. This fund is created to support various activities aimed at combating illegal deforestation. Specifically:
40% of the fund is designated for the Secretary of State to provide financial and technical assistance to foreign governments committed to eliminating deforestation. This allocation recognizes the global nature of deforestation issues and seeks to build international cooperation and capacity.
50% is allocated to the Commissioner of U.S. Customs and Border Protection to carry out the duties under the new regulations, ensuring compliance and proper enforcement.
10% is available to the United States Trade Representative for duties related to the act's implementation.
Related Issues
Several issues arise concerning the financial aspects highlighted in the bill:
Complex Regulations and Resource Allocation: The establishment of funds derived from penalties and the financial distribution to various federal agencies aim to address deforestation, but the processes for compliance, as detailed in the bill, could create heavy administrative burdens. Smaller importers might find it challenging to meet these requirements, putting them at a potential disadvantage. Additionally, multiple federal agencies' involvement could lead to bureaucratic inefficiencies, which may result in the mismanagement of funds and resources.
Potential Financial Misuse: Without clear performance metrics, there is a risk of financial misuse with the funds allocated to support foreign governments. The bill's lack of specificity in defining how funding should be managed and enforced could lead to wasteful spending or legal complexities.
Public Disclosure of Confidential Business Information: The requirement to make certain import declaration information publicly available poses privacy and confidentiality risks for businesses. There is a need for careful handling of sensitive business information, which lacks clarity in the bill, potentially impacting fiscal practices.
Procurement Preferences
The bill also outlines procurement preferences for commodities that are not produced on deforested land:
- The act proposes a 10% reduction in bid price for contractors who demonstrate compliance with environmentally friendly sourcing policies. While this aims to incentivize sustainable practices, it may result in higher costs for the government and could conflict with international trade agreements.
Overall, while the FOREST Act of 2023 strives to allocate funds appropriately to combat illegal deforestation, the specifics around financial management and resource distribution require clearer definition to prevent inefficiencies and ensure the effective use of resources. The potential for administrative burdens and the importance of aligning with international trade agreements underscore the need for careful implementation of the bill's financial provisions.
Issues
The definition of terms such as 'reasonable care', 'sufficient information', and 'wholly or in part' in Section 3 and Section 527A are vague, which may lead to varying interpretations and inconsistent enforcement, posing legal and compliance challenges for importers and federal agencies.
The establishment of the Trusted Trader Program in Section 3(b)(4) may favor larger companies with more resources for compliance, creating a potential disadvantage for smaller importers and raising concerns about fairness and accessibility.
The extensive requirements for compliance with traceability and supply chain transparency in Sections 3 and 7 could impose significant administrative burdens on businesses, particularly smaller companies, impacting economic efficiency and competitiveness.
Sections 5 and 6 lack clear definitions and performance metrics for how funding and penalties related to illegal deforestation will be managed and enforced, leading to potential financial misuse, wasteful spending, and legal complexities.
Privacy and confidentiality issues in Section 527A(e)(1)(D) are highlighted by the requirement to make certain import declaration information publicly available, potentially exposing sensitive business information.
The collaboration between multiple federal agencies and foreign governments as described in Sections 3, 5, and 6 is complex and may result in bureaucratic inefficiencies and diplomatic challenges, potentially hindering effective international cooperation.
The proposed amendments to existing laws and introduction of new regulations might lead to conflicts with international trade agreements, raising potential legal issues and necessitating careful alignment with international obligations as mentioned in Section 527A(h).
The effectiveness of enforcement measures in Sections 3 and 6 is uncertain due to the lack of clear accountability measures and resource allocation strategies, which might undermine efforts to combat illegal deforestation and associated illegal activities.
The proposed procurement preferences in Section 7 could lead to higher costs for the government and potential trade barriers, risking non-compliance with international trade agreements and impacting fiscal budgets.
Sections
Sections are presented as they are annotated in the original legislative text. Any missing headers, numbers, or non-consecutive order is due to the original text.
1. Short title Read Opens in new tab
Summary AI
The first section of the bill states that this law may be called the "Fostering Overseas Rule of Law and Environmentally Sound Trade Act of 2023" or simply the "FOREST Act of 2023".
2. Findings; sense of Congress Read Opens in new tab
Summary AI
Congress finds that illegal deforestation significantly harms the environment and biodiversity and raises concerns about human rights abuses, affecting global trade and the U.S. economy. They emphasize the need for the U.S. to better address these issues by improving trade and import practices, aiding foreign countries in controlling deforestation, and ensuring transparency and legal compliance in supply chains.
Money References
- For example, in 2022, the United States imported— (A) processed cowhides and beef products valued at more than $1,100,000,000 from Brazil, where a recent study estimated 95 percent of deforestation was not in full compliance with applicable laws; and (B) crude palm oil and palm kernel oil valued at more than $2,600,000,000 and oleochemicals commonly derived from palm oils valued at more than $900,000,000, from Indonesia, where government audits of the sector in recent years have indicated widespread noncompliance with applicable laws regarding deforestation. (12) The lack of traceability in the supply chains for such commodities and the absence of importer due diligence requirements increases the risk that United States trade is associated with illegal deforestation and human rights abuses, preventing United States consumers from knowing where or how the goods they purchase were produced and putting companies that ensure legal sourcing at a competitive disadvantage. (b) Sense of Congress.—It is the sense of Congress that the United States must do more to address illegal deforestation, including— (1) avoiding trade that incentivizes foreign governments to allow illegal deforestation; (2) assisting foreign governments in eliminating illegal deforestation and limiting all deforestation to the extent practicable; (3) requiring that goods entering the United States market be subject to requirements, including the necessary supply chain traceability, to reduce the risk of association with illegal deforestation; (4) preventing the United States financial system from being used to launder proceeds from illegal deforestation; and (5) providing procurement preference incentives to suppliers of the Federal Government to adopt and implement policies to eliminate goods produced on deforested land from their supply chains. ---
3. Prohibition on importation of commodities produced on illegally deforested land and products made from such commodities Read Opens in new tab
Summary AI
The FOREST Act of 2023 amends the Tariff Act of 1930 to make it illegal to import products made from commodities grown on illegally deforested land. Importers must prove they used reasonable care to ensure their products are free from commodities linked to illegal deforestation, and the government will enforce this through audits and guidance.
527A. Prohibition on importation of products made wholly or in part of commodities produced on illegally deforested land Read Opens in new tab
Summary AI
The section outlines rules to prevent importing products made from commodities grown on illegally deforested land, requiring importers to document their efforts to avoid such sources, and includes guidelines for verifying supply chains. It also establishes oversight measures, like audits and interagency cooperation, to ensure compliance with anti-deforestation laws, and creates advisory groups for better implementation of these regulations in alignment with international agreements.
4. Implementation of Lacey Act import declarations for pulp and paper products Read Opens in new tab
Summary AI
The section mandates that if the requirement for import declarations under the Lacey Act hasn't been fully enforced for pulp and paper products, the Secretary of Agriculture must ensure enforcement within 210 days of the law being enacted. Additionally, a notice must be published in the Federal Register within 30 days of the law's enactment to announce this enforcement timeline.
5. Foreign assistance for countries committed to eliminating deforestation Read Opens in new tab
Summary AI
The section outlines a U.S. policy to help foreign countries stop illegal deforestation and sets up a fund in the Treasury Department to support this goal. The fund is divided so that 40% goes to the Secretary of State for international assistance, 50% to Customs and Border Protection for enforcement, and 10% to the U.S. Trade Representative for related responsibilities.
6. Inclusion of illegal deforestation as specified unlawful activity Read Opens in new tab
Summary AI
The section amends the United States Code to include illegal deforestation as a specified unlawful activity. It adds that knowingly carrying out, enabling, or encouraging illegal deforestation is now considered an offense under the law, as defined in the Tariff Act of 1930.
7. Procurement preference for commodities not produced on land subject to deforestation Read Opens in new tab
Summary AI
In this section of the bill, Congress proposes a rule for government contracts that gives a 10% bid price reduction to companies that prove their products are not made from commodities linked to deforestation. Companies must have a public policy in place that tracks the origins of these commodities and ensures compliance with related laws.
4715. Procurement preference for commodities not produced on land subject to deforestation Read Opens in new tab
Summary AI
In the proposed bill section, government agencies are encouraged to give preference to bids for products made from certain materials if the bidder has a policy ensuring those materials don’t contribute to deforestation. This policy must include clear measures for tracing the materials' origins, compliance with local laws, and making related information accessible to the public.