Options for EU recognition of the MSPO certification scheme

This report explores policy options available for the formal recognition of the Malaysian Sustainable Palm Oil (MSPO) certification scheme by the EU. Such recognition can contribute to reducing compliance costs, strengthening competitiveness, and ensuring continued access to essential products for European businesses and consumers.

The report assesses a spectrum of policy options, ranging from utilising upcoming EU regulations as a vehicle for recognition (e.g. the EU Regulation on Deforestation-Free Products, EUDR) to options that may require larger political efforts, such as drafting or redrafting political or new free trade agreements. By analysing a comprehensive range of options, the report aims to provide an overview of how the EU could effectively integrate the MSPO scheme within relevant frameworks.

The report finds that multiple pathways exist under current EU laws for the European Commission to formally recognize the MSPO. Our analysis identifies several options, including:

• Approval as a certification scheme, similar to existing recognitions for biofuels in RED II
• Equivalency recognition, similar to existing agreements (e.g. US-EU Organic Equivalency)
• Bespoke bilateral agreements with an FTA, CEPA or VPA between the EU and Malaysia

These options are not mutually exclusive, and both the EU and Malaysia could pursue multiple pathways concurrently. Additionally, the options differ across several evaluation parameters, offering flexibility in the approach towards formal recognition.

While the MSPO is used as an example throughout the report, the logic and arguments would also apply for other similar products or third country certification schemes.