As we continue to work with Traces NT, it’s important to clarify what this system is—and perhaps more crucially, what it isn’t. For those navigating the complexities of the EU Deforestation Regulation (EUDR), Traces NT plays a key role, but it has limitations that businesses need to be aware of.
What is Traces NT?
Traces NT is an EU-adapted system, repurposed to align with EUDR compliance requirements. Despite being a key component in the compliance process, it’s not a new system; rather, it’s an existing framework that has been updated to handle EUDR-related data submissions.
Here are the main functions of Traces NT:
- Self-assessed EUDR declarations: This is the platform where operators record their EUDR declarations.
- DDS reference numbers: Traces NT is the source for Due Diligence Statement (DDS) reference numbers, required for both import and export documentation.
- Geolocation submission: Traces NT is also where geolocation data of source commodities is submitted, which is a particularly challenging task for many operators, as it relies on accurate and comprehensive information from suppliers.
What information does Traces NT require?
- Operator details: Operators, meaning those importing goods into the EU or exporting from it, are required to submit information. For certain internal movements, operators must also provide data, though this is more specific.
- Product information: Traces NT requires details about the products being placed on the market, particularly their Harmonised System (HS) codes, which are listed in Annex 1 of the EUDR. These codes indicate which products fall under EUDR compliance.
- Source commodities: This includes both the scientific and common names of the source commodities.
- Geolocation data: The most challenging piece is the geolocation data that is required for the source of commodities. The system expects geolocation coordinates in a Geojson format, with a file size limit of 25MB. However, this limit is generally more than sufficient for most operators as - depending on the spacing of the geocoordinates - it would allow for thousands of polygons representing millions of hectares. Even if limits were hit then there are options to optimise the polygon representation..
While this may seem like a significant amount of information, in practice, it’s relatively minimal compared to other regulatory frameworks.
What Traces NT won’t do
Traces NT is a crucial system, but it’s important to understand its limitations:
- No information from suppliers: Traces NT does not facilitate the transfer of due diligence information from your suppliers.
- No storage of due diligence data: It’s not a repository for storing the broader data you gather during your due diligence process.
- No validation of due diligence: Traces NT will not validate your DDS submissions for you. The responsibility for ensuring the accuracy of the data lies with the operator.
- No data sharing with customers: You cannot use Traces NT to pass due diligence information to your customers.
- No exemption from due diligence: Even if your supplier has submitted a DDS, you are still required to perform and submit your own.
A key change under the EUDR is that it now also covers exports. Under previous regulations, such as the EU Timber Regulation (EUTR), only importers were responsible for due diligence. Now, exporters are also required to comply, meaning that everyone in the supply chain must be aware of and share the relevant information.
How will enforcement use Traces NT?
Enforcement bodies will use the DDS reference numbers submitted through Traces NT to verify compliance. This will apply to all imports and exports, with customs blocking any shipments - of in scope products - that are missing an appropriate DDS reference number. This could lead to costly delays or demurrage charges.
Additionally, enforcement agencies are anticipated to use geolocation data for their own analysis, targeting high-risk areas for closer inspection. Spot checks will likely be conducted to ensure operators can back up the statements they have submitted. Much like tax self-assessments, the authorities can request proof of the data provided, so it’s essential to have the necessary evidence - backing up due diligence claims - readily available.
How can you use Traces NT?
Before engaging with Traces NT, you need to determine whether you are the operator responsible for submitting a due diligence statement. If you are not, then Traces NT is not a system you need to interact with.
For those who do need to submit due diligence statements, there are two primary methods:
- Direct submission via the user interface: This method requires manual submission of data for each new shipment, as nothing is saved between shipments. Operators must also upload geolocation data themselves.
- API integration: NT Traces now offers an API for automated submissions, a feature that wasn’t expected to be ready until 2028 but has been introduced in time for the end of 2024. The API covers the core EUDR requirements but is still somewhat limited.
For businesses dealing with complex supply chains and significant data demands, a comprehensive solution like Interu’s traceability platform is highly recommended. It allows for efficient data management, storage, and submission, ensuring compliance with EUDR requirements. By streamlining the process, such systems help ensure accuracy and reduce the burden of managing large datasets.
In summary
Traces NT is a system designed by the EU to collect a small but vital set of data for EUDR compliance. However, it is not a system for storing, sharing, or validating your broader due diligence efforts. Businesses must ensure they have a separate system in place to manage and store the evidence needed to back up their Traces NT submissions. For this, tools like Interu’s traceability solution can be invaluable, helping operators navigate the increasing demands of EUDR compliance.
By understanding both the capabilities and limitations of Traces NT, businesses can better prepare themselves for the complexities of EUDR and avoid potential pitfalls in the compliance process.
Get in touch today to see how Interu integrates with Traces NT, or to see a demo.
