Global deforestation and forest degradation are responsible for at least 10% of climate change. This result is due to the trade of timber, wildlife, and other products associated with forests. Deforestation regulations, like the United States Lacey Act, aim to protect forests and wildlife by mandating deforestation-free supply chains. As one of the early protections against the degradation of forests, the Lacey Act paved the way for more recent legislation such as the European Union Deforestation Regulation (EUDR).
When was the Lacey Act enacted?
The Lacey Act was originally enacted in 1900 as a conservation law aimed at preserving native animal species and habitats by outlawing the trafficking of illegally sourced game animals. In 2008, the act was significantly amended to include provisions against importing illegally sourced timber, plant materials, and products derived from them, marking a critical step in combating global deforestation. The act was further updated in 2024 with Phase VII, further expanding its scope.
Who enforces the Lacey Act?
The Lacey Act is enforced by various U.S. Departments of Agriculture, Commerce, and Interior agencies, which include the Animal and Plant Health Inspection Service (APHIS), the National Marine Fisheries Service, and the Fish and Wildlife Service (FWS).
Lacey Act Phase VII explained
On December 1, 2024, Phase VII of the Lacey Act took effect, broadening the act’s scope to include additional imported plants and wood products that previously did not require declarations. According to APHIS, this phase now mandates a Lacey Act Declaration for all remaining plant product Harmonized Tariff Schedule (HTS) codes, excluding items made entirely of composite materials.
A comprehensive list of newly covered items is detailed in the Federal Register notice. Examples include:
- Plywood and laminated wood
- Tools
- Natural cork
- Bamboo and rattan
- Footwear
- Essential oils
Companies dealing with products containing plant materials not previously subject to these filing requirements are now likely required to submit Lacey Act Declarations under Phase VII.
Which products are within the scope of the Lacey Act?
The Lacey Act was originally designed to protect game animals but has since evolved to include prohibitions on illegally sourced wood and timber products.
The full scope of products under the Lacey Act includes:
- All plants, including trees and shrubs
- Wild animals, fish, and birds
- Any product derived from these plants or animals
Timber, paper products, furniture made from certain types of wood, certain foods, and even some instruments, are all within the act's scope. Due to the wide range of products covered under the Lacey Act, awareness of material composition is crucial. Companies should note that products containing plant-based materials may fall within the act's scope.
The Lacey Act also applies if:
- The shipment falls under any of the entry-type codes mentioned here
- The shipment has an aggregate value of at least $2,500 and is covered by a bond
- The imported product is classified under a Harmonized Tariff Schedule (HTS) code as listed on APHIS’ Implementation Schedule
Which companies must comply with the Lacey Act?
Companies that import, export, transport, sell, receive, acquire, or purchase plants must comply with the Lacey Act. This includes timber and timber products, as well as wildlife trade. Businesses must assess their supply chains to ensure they are not dealing with products illegally taken or traded in violation of U.S. federal, state, or foreign laws.
Lacey Act compliance: what you need to know
Compliance with the Lacey Act revolves around due diligence, which requires companies to collect data to be certain about the origins of their products and materials. To comply with the Lacey Act, companies must first assess if any imported goods or products contain plant material, including wood. When certain other conditions are met, and legality is confirmed, they must file a Lacey Act Declaration.
Filing a Lacey Act Declaration
A Lacey Act Declaration can be filed both electronically and on paper. The declaration must contain extensive information including (but not limited to):
- Scientific plant names
- Country of harvest
- Product value (USD)
- Quantity of plant material in the shipment.
- Supplier information
- HTS Code
- Percentage of recycled content
For more information, see the template.
What are the penalties for non-compliance?
The penalties for noncompliance with the Lacey Act vary based on the nature and frequency of the violation, such as:
- Civil penalties: Unintentional violations may result in civil fines.
- Criminal penalties: Knowingly violating the act can lead to more severe fines and even imprisonment.
- Forfeiture of goods: Products sourced or traded in violation of the Act can be seized by authorities.
Beyond the direct legal implications, companies found in violation of the act may suffer significant reputational damage.
Learn about deforestation-free supply chains with Source Intelligence
As the global regulatory landscape continues to evolve, companies must address their supply chain’s impact on deforestation to remain compliant and up to date with deforestation regulations. The sourcing of deforestation-free timber requires an understanding of supplier risk, due diligence, and high-risk locations. Source Intelligence offers further education on deforestation through our Defeating Deforestation webinar, which covers other deforestation regulations such as the EUDR.
