Peruvian Timber on the Hot Seat

In a press release, the Office of the United States Trade Representative (USTR) directed United States Customs and Border Protection (CBP) to block future timber imports from a Peruvian exporter, Inversiones Oroza SRL for three years or until it is determined that the company has complied with all applicable Peruvian laws, regulations, and other measures, whichever is shorter. This is the first enforcement action taken by the
Interagency Committee on Trade in Timber Products from Peru (Timber Committee) under the 2009 United States – Peru Trade Promotion Agreement’s (PTPA) Annex on Forest Sector Governance (Forest Annex), which allows the United States to request that the Peruvian authorities verify the origin of exporter’s timber.

The PTPA removes trade barriers, provides a secure predictable legal framework for investors, and strengthens protection for intellectual property, workers, and the environment. Under the PTPA, more than two-thirds of current U.S. farm exports became duty-free immediately and the remainder will be phased out within fifteen years. The PTPA also includes commitments and cooperation to protect the environment through the Forest Annex.

Based on reports that Inversiones Oroza SRL was engaging in illegal logging activities, the Timber Committee requested a verification report from Peru that a January 2015 timber shipment from Inversiones Oroza SRL complied with all applicable Peruvian laws and regulations. The timber in the January 2015 shipment came from twelve forest land title holders in the remote areas of the region of Loreto, Peru. After conducting robust on-site post-harvest inspections of all twelve land titles implicated in the shipment Peruvian authorities determined that “significant portions” of the Inversiones Oroza SRL were not compliant with Peru’s laws, regulations, and other measures on harvest and trade of timber products, in violation of the Lacey Act.

An Associated Press investigation showed that in October 2015, on evidence of illegal harvesting, Homeland Security Investigators (HSI) denied entry to 1,770 metric tons of Amazon rainforest wood. However, that seizure was thanks to the help of the chief of Peru’s forest inspection service, Forest and Wildlife Resources Oversight Agency (OSINFOR), who was quickly dismissed after the seizure. A recent interview with Peru’s former Executive Chairman of OSINFOR has exposed the shortcomings of the Peruvian government in combating illegal logging due to the influence of corruption and organized crime.

If you've experienced a seizure by U.S. Customs of timber, or if you have any questions about importing timber, utilizing PTPA, or Lacey Act compliance, please contact Diaz Trade Law at info@diaztradelaw.com, or 305-456-3830.