In late 2024, ISEAL commissioned AidEnvironment to carry out a research consultancy on tools and initiatives that support compliance with the EUDR’s legality requirement, an obligation to comply with local laws. The research shares insights on the path to legal and traceability compliance.

With increased scrutiny on global supply chain practices, commodity-producing countries face mounting pressure to meet new legal, traceability, and sustainability reporting requirements. Specifically, the EU Deforestation Regulation (EUDR) mandates traceability back to farm plot, compliance with local legislation, and proof of due diligence in the sourcing of deforestation-risk commodities like coffee and cocoa. These requirements aim to curb deforestation and promote responsible sourcing but pose significant challenges to local producing communities, particularly in regions with complex land tenure systems and limited formal documentation.

While much attention has been given to deforestation-free and traceability requirements under EUDR, the legality aspect – encompassing land use rights, environmental protection, labour rights, and human rights – presents a more complex challenge. Demonstrating compliance involves verifying land ownership, resource rights, and local legal frameworks, which can be difficult in many producer countries. Many smallholder farmers operate under informal land tenure arrangements that lack formal titles, making it difficult for companies to verify legal ownership and meet global legality requirements. Addressing these challenges requires context-specific approaches that balance compliance with inclusivity, ensuring smallholders are not excluded from global markets.

Uganda as a case study: land tenure complexity

Uganda exemplifies the complexity of these challenges, highlighting the need for collaboration and tailored approaches in commodity supply chains. With the EU as the primary market for Ugandan coffee exports, the country faces a pressing need to align with EUDR requirements. However, Uganda’s long-standing land tenure system presents significant barriers to full compliance, in sectors like coffee that are characterise by smallholder farming. 

The Ugandan 1995 Constitution recognises four types of land tenure: freehold, leasehold, customary tenure, and mailo land. Customary tenure, the most common form, involves communal ownership by clans or families and lacks formal documentation. Though legally recognised in Uganda, customary tenure complicates formal land ownership verification, posing obstacles for companies seeking to meet EUDR requirements.

The Uganda Land Act 1998 outlines two ways to prove land ownership without formal land title; inheritance through family lineage or purchase through a complex and costly bureaucratic process. Many farmers avoid the latter due to its complexity, while overlapping claims and double registrations, often linked to bribery and corruption, further hinder legal clarity.
The absence of land titles and complicated process for proving land ownership emphasise the need for innovative verification solutions that balance legal requirements with local realities.

Free, Prior, and Informed Consent (FPIC)

The principle and implementation of Free, Prior, and Informed Consent (FPIC) is critical for safeguarding the rights of indigenous peoples and local communities. FPIC ensures communities can consent to or refuse activities affecting their rights, land, resources, territories, livelihoods and food security without coercion and with full transparent access to information. 

In Uganda, both the 1995 Constitution and the Uganda Land Act 1998 protect FPIC principles. However, despite these legal provisions, FPIC is often not fully realised in practice. Challenges such as gaps in enforcement and governance issues can undermine its implementation. Strengthening the mechanisms that support adherence to FPIC is essential not only for legal compliance but also for building trust in commodity supply chains.

FPIC’s effective implementation requires culturally appropriate and ongoing stakeholder consultation processes, which can be supported through increased collaboration among local communities, governments, certification bodies, and private sector actors. Voluntary sustainability systems are well-placed to support this stakeholder engagement process, a topic area that ISEAL will continue to explore in its work around FPIC in 2025.

Traceability challenges in Uganda’s Coffee Sector

Uganda’s coffee sector demonstrates the broader traceability challenges faced by many producer regions in deforestation-risk sectors. Despite approximately 60% of Uganda’s coffee exports reaching the EU, the country’s free-market trading system means it’s difficult to trace products back to origin. The system does not require use of cooperatives or auctions like in other coffee-producing countries. Instead, most coffee is sold indirectly through multiple buyers and intermediaries, creating fragmented supply chains at risk of overlapping data, farmer fatigue from repeated mapping efforts, and issues with compliance with EUDR traceability requirements.

To address this, Uganda’s largest coffee exporters have launched a collaborative initiative to establish a shared traceability system and a nationally shared data warehouse. This effort includes the introduction of:

• Plot registry: allowing traders to access and declare the polygons of all potential farmers within their supply base via an allowance called declaration in excess. 

• Traceability Apps: rolling out the use of an app that allows for farmers’ identification and “pure” plot traceability.

While these projects show great promise, they focus primarily on traceability and geolocation and fall short of addressing the legality aspect of EUDR compliance. The complexity of land tenure and the lack of formal documentation make it difficult for operators to verify ownership – meaning that despite these efforts, it will remain challenging to demonstrate the EUDR compliance of Ugandan coffee.

Pathways forward: collaboration and adaptation

Uganda’s experience highlights the need to ground emerging regulatory compliance obligations in local realities, and the risk of smallholder exclusion from increasingly regulated supply chains.  ISEAL Community Members are uniquely positioned to support producers – both large and small – to demonstrate compliance with local and national legislation, and provide those importing relevant materials into Europe the confidence to continue sourcing from certified producers. Outside of their certification and audit programmes, many sustainability systems are also working with local partners to influence the broader enabling environment, supporting producers to clarify land rights and protect the rights of indigenous peoples. 

Achieving global legality and traceability ambitions of the EUDR will require a combination of: government support, strengthening local land governance; clarifying tenure rights; private sector innovation, developing scalable traceability tools and sharing pre-competitive data; and community empowerment, ensuring FPIC is respected and communities have the knowledge to engage in decision-making.

Uganda’s journey highlights both the challenges and complexities producer countries face in adapting to evolving  global trade requirements. By fostering collaboration, embracing innovation, and prioritising inclusivity, Uganda – and countries facing similar hurdles – can build a more sustainable, equitable, and transparent agricultural future.

 ISEAL's work on deforestation-free supply chains is generously supported by the Walmart Foundation.