19.02.2021 | Kommentarer

Lie, clout and corruption, verified way be in deal with EU customers

How easy illegal timber can pass laws to get your home? Investigators from Earthsight published a report about illegal logging in Russia and its consequences. Can you imagine your new wood floor is from ruthlessly cut down natural trees? The trees were part of the largest forest ecosystem in Asia, a home for endangered species like a Siberian tiger, a brown bear, and a lynx.

According to the report “Global forest products facts and figures 2016” Russia has the second position in the global race in roundwood production. European Union is one of the main importers of the Russians roundwood. In the leadership positions are Germany, Finland, Austria and Sweden. These countries have strong and long-term trade relationships with Russians timber producers.

There are many reasons why we should be interested in timber trade between Russia and the EU. First of all, the EU takes a role as a leader of the cycling economy, trying to avoid the consequence of deforestation and climate changes. Secondly, EU Commission in 2003 undertook certain actions to prevent illegal logging and associated trade in Forest Law Enforcement Governance and Trade (FLEGT) Action Plan[1] and supported this plan by banning in 2013 imports of timber sourced illegally[2]. Moreover, the EU Timber Regulation, also requires importers to carry out due diligence on the wood they buy, to reduce the risk of trading illegal goods to a "negligible" level[3]. And an advance, the EU is one of the pioneers in developing national forest certification systems such as PEFC and FSC.

BM Group scam venture

2019 shows the public one of the largest forest scams in this century in Russia[4]. On the Far East of Russia the chain of companies called BM Group, linked with some provincial government in the criminal bundle, getting thousands of hectares of virgin forests without any approval, using lies, clout and total corruption. On the one hand, criminals getting millions of rubles subsidies from Moscow as a priority sawmill project. On the other, they had almost free access to the most profitable locations of pristine natural forests. Mercilessly cutting forest without any restoration activities, in the wildlife protected zones, with selling directly abroad. The true motives appeared only when financial papers got to the Accounts Chamber of the Russian Federation and the Federal Security Service, or FSB, at the end of 2018[5]. Suddenly, the priority project of the sawmill becamealmost nothing.

Gem wood

From the Nordic Sea to Japan Sea lies the largest forest zone called Taiga. The forest is slow-grown, because of changing winters and summer seasons with a pause of the growing. This gives a straight, strong, dense wood valued in the world.

The main products of the BM Group affiliates were timbers from Dahurian larch, Siberian spruce and Dark-bark spruce. Larch is especially valued as more strong and water-resistant timber. This makes it a popular material for interior decoration, cladding buildings and building yachts.

Involved countries and companies

Indeed, which countries were the best clients of BM Group affiliates? The frequent destinations of the timber trains were China, Japan and the EU. About 21% of dubious products produced before and after the scam has lighted, has gone to countries using laws to prevent and stop illegal timber trade.

The EU legislation, actually, is one of the contemporary in the world. EUTR was as part of a package aimed to decrease the wood consumption in the EU that was a driver of uncontrolled logging overseas. In fact, studies show that in 2016 and earlier, illegal timber came to the EU in the most part from Russia, and its share increasing. EUTR guidance for importers clearly states that wood harvesting in the Far East is 80% illegal[6].

Wondered, €2.9 billion of all wood products from Russia were imported only in 2019, up from €1.9 billion in 2012.[7]

Since 2015 BM Group affiliates have exported almost €190 million of suspect wood. Thereof, about €30 million worth in Europe in spite of an EU law bans imports of stolen wood.

BM Group timbers linked to illegal logging passed to Europe as legal and certified by a PEFC.

Finally, the largest BM Group customer in France is ISB France, a part of ISB Group. This company is a supplier of sawn timber and wood panels to the DIY chains as Leroy Merlin, Mr. Bricolage and Castorama.

Bosses of BM Group are in jail, fields of stumps try to restore, Siberian tigers moved deeper in the forests, and it seems illegal wood products are still on the shelf of warehouses.

So, what about your new floor?

[5] Accounts Chamber of Russia (2018) Report on the results of the control measure

“Verification of the use of the subsidy allocated in 2017 and the expired period of 2018 (if

necessary in an earlier period) from the federal budget to Russian timber processing

enterprises of the Far Eastern Federal District participating in the implementation of priority

investment projects in the field of forest development, for compensation part of the costs

incurred in 2013-2018 for the implementation of such, Accounts Chamber Bulletin,

26 December 2018: 12(252), https://ach.gov.ru/upload/iblock/45a/45a2f548fa9352f58649023f79044cd4.pdf

[7] Data from Eurostat for imports of timber (HS Code 44), pulp (HS47) and paper (HS48), converted into USD at prevailing rates



 This article was written in the context of the "Environmental Outreach" course as part of the Sustainable Coastal Management Program at Novia UAS.