The ЕВА сontributed to the finalisation of the draft law “On the Timber Market”

28/ 04/ 2025

On 24 April, another meeting of the Verkhovna Rada Committee on Economic Development took place. The main item on the agenda was a review of the Committee’s decision regarding the draft Law of Ukraine On the Timber Market (second reading, reg. No. 4197-d). Following the meeting, participants agreed to amend the final provisions of the draft law by assigning the government the task of providing additional support to small and medium-sized businesses in the regions. The meeting also addressed the advisability of extending the moratorium on the export of unprocessed timber. Experts from the EBA emphasise that the continuation of the moratorium would protect domestic wood-processing enterprises. This would encourage greater investment in production, the creation of new jobs, the development of the labour market, and growth in tax revenues. The business community supports the decision by Members of Parliament to extend the moratorium and stresses the importance of maintaining the export ban on timber in the final version of the On the Timber Market law for the duration of martial law. According to the EBA’s experts, the extension of the moratorium does not contradict European legislation. In particular, it is in line with Articles 472 (Measures Related to Essential Security Interests) and 143 (Security Exceptions) of the EU-Ukraine Association Agreement, as well as paragraph (b)(iii) of Article XXI Security Exceptions of the General Agreement on Tariffs and Trade (GATT 1947). This measure is especially relevant given the mining of forested areas in Ukraine, which prevents timber harvesting and restricts access to raw materials for wood-processing enterprises. Wood-processing companies also once again highlighted the significant rise in prices for almost all types of timber in the first quarter of 2025, mainly due to insufficient harvesting volumes.

Following the meeting, participants agreed to amend the final provisions of the draft law by assigning the government the task of providing additional support to small and medium-sized businesses in the regions.

The meeting also addressed the advisability of extending the moratorium on the export of unprocessed timber. Experts from the EBA emphasise that the continuation of the moratorium would protect domestic wood-processing enterprises. This would encourage greater investment in production, the creation of new jobs, the development of the labour market, and growth in tax revenues. The business community supports the decision by Members of Parliament to extend the moratorium and stresses the importance of maintaining the export ban on timber in the final version of the “On the Timber Market” law for the duration of martial law.

According to the EBA’s experts, the extension of the moratorium does not contradict European legislation. In particular, it is in line with Articles 472 (“Measures Related to Essential Security Interests”) and 143 (“Security Exceptions”) of the EU-Ukraine Association Agreement, as well as paragraph (b)(iii) of Article XXI “Security Exceptions” of the General Agreement on Tariffs and Trade (GATT 1947). This measure is especially relevant given the mining of forested areas in Ukraine, which prevents timber harvesting and restricts access to raw materials for wood-processing enterprises.

Wood-processing companies also once again highlighted the significant rise in prices for almost all types of timber in the first quarter of 2025, mainly due to insufficient harvesting volumes.