Summary
The European Union Deforestation-Free Regulation (EUDR, Regulation (EU) 2023/1115 of the European Parliament and of the Council of 31 May 2023) is set to enter into force in early 2027, after two postponements. This regulation was enacted in July 2023 and aims to reduce the deforestation footprint of the EU for a given selection of goods: soya, coffee, cattle, rubber, cocoa, wood, and palm oil, along with their derived products. Although the regulation's effects have yet to become legally binding, its impacts on deforestation and land use should occur earlier, given that it prohibits EU countries from importing these goods if produced on land deforested or degraded deforested land after December 2020. In this context, this paper analyzes from legal and economic perspectives whether preceding and anticipatory effects, respectively, of this regulation exist, focusing on deforestation and land use in Brazil. We deploy an impact analysis, anchored by a legal analysis, that measures the EUDR's impact on deforestation and land use patterns. Our model employs novel data on municipalities' production directed toward exports, singling out exports of selected goods to the EU. These novel data and methods allow for conclusions indicating that the EUDR has not yet produced any identifiable effect on deforestation or land use.