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EUDR 101: What Are Operators and Traders?
Understanding EUDR terms is crucial for long-term compliance
Published September 16, 2025
Asharita D'Silva
Expert@Era of We
The EU Deforestation Regulation (EUDR) introduces strict requirements for businesses involved in placing, making available, or exporting relevant products on the EU market. A central element of the Regulation is the distinction between “operators” and “traders,” as each category carries different obligations for compliance and due diligence.
Understanding these definitions is critical for businesses across global supply chains, as misclassifying one’s role could lead to legal exposure and financial penalties.
This article clarifies what it means to be an operator under the EUDR, how operators differ from traders, and the practical implications for businesses navigating this regulatory framework.
What is An Operator in EUDR?
EUDR defines an operator as any natural or legal person who places relevant products on the EU market or exports them. Operators also include companies that purchase raw materials from companies that export into the EU and transform them into a new product that is then placed on the EU market.
For example, a company that imports cocoa butter into the EU would be an operator and a company that then purchases this cocoa butter to manufacture chocolate is also an operator. The cocoa butter imported by the first company has one HS code while the chocolate produced by the second company has a new HS code, and hence both companies are considered operators. The first company would be considered an “upstream operator” and the latter would be a “downstream operator”. Further along the supply chain, we can also consider a third company that exports this chocolate outside the EU, and this company would also be considered a downstream operator under EUDR.
When submitting their due diligence statement in the Information System, operators further down the supply chain may refer to due diligence performed earlier in the supply chain by including the relevant reference number for the parts of their relevant products that were already subject to a due diligence check.
However, they are obliged to ascertain that due diligence was carried out and they retain legal responsibility in the event of a breach of the Regulation. For parts of relevant products that have not been subject to due diligence, operators must exercise due diligence in full and submit a due diligence statement.
How Does EUDR Define a Trader?
A trader is any natural or legal person in the supply chain, other than the operator, who makes relevant products available on the EU market. Essentially, they place the product unchanged on the market.
Continuing with the previous example, a trader would be a company that buys chocolate and sells it in stores and supermarkets.
Traders do not import, export, or change a product but simply trade and distribute existing products already within the EU market.
Some of the responsibilities of traders depend on the size of the company, including:
- Large traders: Similar due diligence obligations as operators.
- Small and medium enterprises (SMEs): Lighter obligations (keep and share records of their suppliers and customers).
- Example: A wholesaler buying timber within the EU to resell to retailers.
The difference between large traders and SME (small and medium enterprise) traders is based on criteria such as net turnover, balance sheet, and number of employees. These stipulations are laid out in the EUDR legislation.
Differences Between Operators and Traders
While both operators and traders are central actors under the EUDR, their responsibilities differ depending on their role in the supply chain and, in some cases, their business size.
Operators
- Place relevant products on the EU market for the first time or export them out of the EU.
- Must carry out full due diligence: collecting product, supplier, and geolocation data; assessing and mitigating risks of deforestation or illegality; and submitting a due diligence statement in the EU Information System.
- Retain full legal responsibility, even when relying on upstream due diligence performed by other operators.
- Must keep records of due diligence documentation for at least five years.
Traders
Their obligations vary depending on size:
- Large traders (non-SMEs): Similar obligations to operators, including due diligence and reporting.
- SME traders: Lighter obligations, mainly to collect and store supplier and customer information for five years and to share this with authorities on request.
In short, operators bear the heaviest compliance burden, while traders’ responsibilities scale with their business size. This distinction makes it vital for EU businesses to correctly identify their role in the supply chain before the rules take effect.
Other Important Terms In EUDR
- Placing on the market: First making a product available in the EU.
- Making available on the market: Any subsequent supply of products already placed on the EU market. This includes the distribution, consumption, or use of a relevant product in the EU market, whether paid for or free of charge.
- Due diligence statement: Mandatory declaration by operators (and some traders) proving compliance.
- Deforestation: The conversion of forested land to agricultural land.
- Deforestation-free: Products must not be sourced from land subject to deforestation after 31 December 2020.
- Forest degradation: Structural changes to forest cover, including conversion of primary or regenerating forests into plantation forests and conversion of primary forests into planted forests.
Practical Implications for Businesses
For EU businesses, the EUDR is not just a regulatory hurdle but a major operational shift that requires preparation well before the enforcement deadlines.
1. Supply Chain Mapping and Traceability
Businesses will need to trace the origin of commodities back to the land plot of production, supported by geolocation coordinates. This means engaging closely with suppliers, ensuring accurate data flows, and identifying high-risk sourcing countries.
2. Building or Upgrading Due Diligence Systems
Operators and large traders must implement formal due diligence processes covering information collection, risk assessment, mitigation measures, and reporting. These systems must be reviewed annually and documented to demonstrate compliance.
3. Digital Compliance and the EU Information System
Submitting due diligence statements will be done via the EU’s central Information System. Companies should ensure they have the technical capacity to submit accurate, timely declarations and to reference upstream statements where relevant.
4. Resource Allocation and Training
Compliance will require dedicated resources, both financial and human. Businesses may need to invest in new IT systems, satellite mapping tools, or supplier audits, and train staff to manage compliance effectively.
5. Size-Based Obligations
SMEs benefit from lighter obligations, but they are not exempt. They must still keep records of suppliers and customers, maintain traceability, and be able to provide information to authorities. Medium and large businesses face full compliance obligations from 30 December 2025, while SMEs have until 30 June 2026.
6. Risk of Non-Compliance
National authorities will conduct checks and enforce penalties for breaches. Sanctions may include fines, confiscation of products, exclusion from public procurement, or temporary bans on market access.
For EU companies, the EUDR demands a proactive approach. Early investment in supply chain transparency, strong due diligence systems, and supplier collaboration will not only secure compliance but also build resilience and trust in a market where sustainability is fast becoming a baseline expectation.
Conclusion
As the EUDR comes into force, correctly identifying whether your business acts as an operator or a trader is not just a matter of compliance; it’s a matter of responsibility and risk management.
Operators bear significant obligations to ensure that products are deforestation-free and supported by due diligence statements, while traders’ responsibilities vary depending on company size. For businesses across the supply chain, the priority should be building robust traceability and compliance systems now, before enforcement deadlines take effect.
Assessing your role under the EUDR today will position your company to remain compliant, competitive, and trusted in an increasingly sustainability-driven market.
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About the author
Asharita D'Silva
Join me in discovering the wonderful world of coffee! As a writer, coffee is my fuel and newfound passion. I love writing about new coffees, sustainability, and coffee culture around the world. I'm always discovering new things about coffee and the industry, which I share with the great community here at Era Of We.
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