At its meeting on February 4, the Committee on Economic Development recommended that the Verkhovna Rada adopt in the second reading and as a whole the draft Law No. 4197-d “On the Timber Market”.
The relevant report on the results of the consideration was published on the official website of the Committee.
Draft Law No. 4197-d defines the legal, economic, and organizational framework for the sale of unprocessed timber and fuelwood on the timber market to meet the needs of timber market participants on the principles of free and fair competition and sustainable use of forest resources.
The most important things in the draft law on the timber market
The text of the draft law No. 4197-d on the timber market in Ukraine, which has been approved for the second reading, is not yet available on the draft law card on the parliament's website. However, the main positions of the document were shared on his Facebook page by Yuriy Dyug, coordinator of the Wood Industry UA economic platform, who took an active part in its discussion:
1. Ukrainian enterprises engaged in wood processing will be included in the relevant state register. They will have priority access to Ukrainian raw materials.
2. The moratorium on the export of unprocessed timber from Ukraine is extended until the end of martial law and for another 5 years afterwards.
3. Timber sales will be carried out in 4 stages:
- main bidding to increase the price (available only to processing enterprises);
- repeated main auctions of the remaining timber to reduce the price (also available only to processing enterprises);
- additional auctions (all business entities that carry out operations with wood have access);
- repeated additional auctions (all business entities have access).
4. The authorized state body – the State Agency of Forest Resources of Ukraine – is responsible for setting the starting price for timber using a transparent formula.
5. Clear requirements are introduced for timber market participants: sellers, auction organizers and buyers.
6. Procedures for the alienation of timber for the needs of the Security and Defense Forces of Ukraine, for customers conducting public procurement, as well as for retail sales to individuals for social needs are regulated.
What is the position of stakeholders?
The European Business Association (EBA) Woodworking and Furniture Committee welcomed the decision of the Committee to adopt the draft law “On the Timber Market”.
The EBA experts support the adoption of the draft law, as the final version of the draft law took into account the following business proposals
- the principle of cascading timber auctions, according to which both an increase and decrease in the starting price can occur, which contributes to the development of competitiveness
- extending the moratorium on the export of unprocessed timber, which will allow domestic processing companies to invest more in their own production, hire more employees and increase the amount of taxes paid;
- granting domestic processing companies the right to purchase timber at stock exchange auctions as a matter of priority, which will protect domestic producers from the threat of abuse by other market participants.
Other stakeholders and MPs also commented to Liga.net. Andriy Tsyganok, Executive Director of the Association of Woodworking Enterprises of Ukraine (ADPU), noted that this draft law will allow businesses to operate under clear rules and ensure the stable development of the industry.
MP Dmytro Kysylevskyi believes it is important that in the draft law, its developers were able to find a formula that will extend the moratorium on the export of roundwood.
“In general, a tremendous amount of work has been done on the draft law, it takes into account different points of view and should be supported,” he says.
Earlier, EcoPolitics published an article about the progress of the draft law No. 4197-d “On the Timber Market” and its main provisions.
