ICE CoT

The European Union Deforestation Regulation (EUDR) is an initiative aimed at combating deforestation and forest degradation. The regulation introduces supply chain due diligence requirements for certain commodities, including coffee, cocoa, and their related products, whether they are imported into, supplied within, or exported from the EU. The aim of the legislation is to ensure that these products are both deforestation-free and legally produced.

The EUDR places specific obligations upon “operators” who import or process materials into covered products within the EU or export them as well as “traders” supplying covered products within the EU. These requirements are designed to demonstrate covered products entering, circulating within, or leaving the EU market have:

Not originated from land that has been deforested after December 31, 2020.
Been produced in accordance with the relevant legislation of the country of production.
Been accompanied by a due diligence statement.

The due diligence process involves collecting specific prescribed information, including the precise geolocation of the plots of land where the relevant commodities were produced. For commodities originating from countries or regions not classified as low risk by the European Commission (EC), operators are required to perform additional risk assessments. If necessary, they must also undertake risk mitigation activities to ensure there is no or only a negligible risk of non-compliance with the EUDR.

In addition to these core requirements, the EUDR also mandates specific protocols related to due diligence processes and systems, record keeping, and data transparency. To enforce these regulations, National Competent Authorities (NCAs) of EU Member States are tasked with conducting checks within their territories to verify compliance among operators and traders.

The consequences of non-compliance with the EUDR are severe. Penalties can include fines of up to 4% of a company's total turnover within the EU, confiscation of relevant products, and temporary prohibitions on importing, supplying, or exporting relevant products to, within, or from the EU.

ICE CoT has been designed to help traders and operators comply with the EUDR while supporting continued trade-ability of cocoa and coffee.

ICE CoT requires farm plot geolocation and related data to be uploaded by a user before uploading any traceability information for product consignments originating or derived from these farm plots. The uploaded farm plot data will be tested by ICE CoT against the Farm Plot Data Validation Methodology and test results returned to the user.

ICE CoT currently supports file upload in GeoJSON format, which is also the format currently required by the EU Information System for due diligence statement uploads. Future support for other formats will be decided upon based on user demand.

Required farm plot input data includes:

ProducerCountry - Two letter country code from ISO 3166-1 alpha-2. For example, “CI” for Côte d’Ivoire or “BR” for Brazil. Must match one of the values within the list of supported countries.
Commodity - “Coffee” or “Cocoa”.
CTOFarmerID - A unique identifier for the farmer, assigned by the user. Multiple farm plots may be linked to the same farmer.
CTOPlotID - A unique identifier for the farm plot, assigned by the user. This field should be unique for each given ProducerCountry and Commodity.
DateofMapping - As details of a plot may change over time, this determines which version of the farm plot was current on a particular date.
Geometry - Either a polygon defining the outline/border of the plot or a point indicating a physical location within the farm plot. If a point is specified, the farm plot area must also be specified. Plots over 4ha must be specified as polygons.
Area - The area of the farm plot, in hectares. Where the geometry is a point, Area is required and must be no more than 4ha.

Optional data may also be added including ProducerName, NationalFarmerID, NationalPlotID, AggregatorIDs, DataProvider, and ProductionPlace.

Underlying documentation to evidence the uploaded information is required to be available for inspection and verification.

Farm plot data is not shared with a buyer or with other users except that: Geometry (plot polygon or geolocation point) is always shared with a buyer until due diligence statement creation, after which it is not shared; other farm plot data may be shared with a buyer at the seller’s option.

Farm Plot Data Methodology Tests

Farm plot data is subject to several tests under the Farm Plot Data Validation Methodology, including using forest mapping data from Space Intelligence along with protected agricultural area information and basic data consistency and reasonability tests, and checks for deforestation and protected area proximity and overlaps. All required data fields must be supplied. Where farm plot data fails any test, that farm plot may not be used as an eligible production plot for any product consignment traceability. Test failures may be challenged by a user if the farm data is believed to be compliant. In in case of upload errors, the data can be corrected and re-uploaded. Some farm plot data tests (e.g. “Farm is extremely large”) have reasonability thresholds which may vary by country.

ICE CoT Farm Plot Data Validation Methodology test methods and thresholds are subject to continuous review and may be updated, removed or added to.

Current tests include:

Basic geometry tests for polygons:

Farm has too few boundary vertices
Farm has self-intersecting boundary segments
Farm plot polygon contains holes
Farm plot polygon is not closed

Deforestation, protected area and plot size tests:

Farm overlaps with deforestation
Farm overlaps with forest
Farm overlaps with protected area
Farm plot is recorded as a geopoint with estimated size greater than 4ha
Geopoint too close to deforestation

Reasonability tests:

Farmer has implausibly high number of farms
Farm plot is distant from farm plots with the same Farmer ID
Farm plot mapping date is far in the past
Farm plot overlaps with other farm plot(s)
Farm plot is duplicated with same Farmer ID
Farm plot is duplicated with different Farmer ID
Farm plot has a very unusual shape
Farm plot boundary has spikes
Farm plot is extremely large
Farm plot is outside of country boundary
Farm plot overlaps built-up area
Farm plot overlaps water body
Farm plot location time-series mismatch
Inconsistent farmer data

EUDR-compliant supply chains are expected to have in place internal management systems which include documented procedures and processes for aggregators and others within supply chains to ensure compliance with applicable legal and compliance risk mitigation requirements, and to identify and confirm on which farm plots any commodities supplied by aggregators were originally produced.

ICE CoT uses questionnaires to collect and analyse information regarding these systems, procedures and processes as they relate to making sure: (i) the commodities and related products contained in or used to make the product consignment were lawfully produced; (ii) as required, appropriate compliance risk mitigation was exercised; and (iii) each product parcel supplied by an aggregator contains or is made only from commodities produced on some or all the farm plots associated with the product parcel within the provided physical flow traceability data, and no other farm plots.

Two types of questionnaires are used:

the registration questionnaire collects information regarding the list of aggregators and the types of internal management systems for each production country, along with information regarding supply chain communication, grievances and compliance violations; and

the legality and risk questionnaire asks how these systems ensure compliance with the applicable legislation for each specified legality topic in each production country and how remaining risks are mitigated.

Relevant systems and documentation to evidence the answers to the questionnaires must be available and may be inspected and verified.

Only aggregators (and related supply chains) with fully and satisfactorily completed questionnaires are eligible to be identified in the physical flow traceability input data for any product consignment.

Registration Questionnaire

The Registration Questionnaire is a standardized questionnaire designed to help assess whether a user has reliable systems and processes in place for aggregators and related supply chains to ensure compliance with and provide reliable information related to lawful production of commodities, including whether and how these systems are audited. It also seeks to obtain information regarding good communication regarding EUDR requirements and effective grievance management procedures, along with information regarding complaints, compliance breaches and legal proceedings.

Legality and Risk Questionnaire

The Lawful Production and Compliance Risk Questionnaire is a detailed and adaptable questionnaire designed to help assess how the internal management systems ensure compliance with applicable local laws and mitigate residual risks of non-compliance with the EUDR. Users must confirm whether they have internal management systems in place covering all aggregators (and the related supply chains) in each production country to collect, verify and risk assess information which shows compliance with relevant legislation regarding each applicable legality topic, including the specific laws identified by local legal and sustainability experts for each legality topic as applicable for each production country. Legality topics include land use rights, environmental protection, third-party rights and Free, Prior, and Informed Consent (FPIC), labour and human rights, and tax, anti-corruption, trade, and customs regulations.

Where the internal management system reveals a risk of non-compliance with relevant legislation, users must confirm they have implemented the required mitigation measures specified regarding each legality topic. If a user does not confirm an internal management system is in place for each legality topic, or does not confirm that the required mitigation measures have been adopted, the aggregators and their related supply chains are not eligible to be referenced in a product consignment within ICE CoT.

Risk Assessment Process

ICE CoT's risk dashboard includes information relating to specified risk criteria and identifies how users can use this as part of their EUDR risk assessment processes regarding a product consignment.

The information includes:

ICE CoT Farm Plot Data Methodology outcome;
ICE CoT Physical Flow Traceability Methodology outcome;
Lawful Production and Compliance Risk Questionnaire outcome;
European Commission production country risk assignments and expert group conclusions;
Data regarding the presence of forest and prevalence of deforestation in the production country (Space Intelligence and EU Observatory maps);
Public resources information regarding corruption perceptions, regulatory quality, rule of law, human rights, conflicts and sanctions in the production country; and
Data regarding indigenous peoples risks.

A product consignment is a specified quantity of a single physical cocoa or coffee commodity product type (e.g. cocoa beans, cocoa butter, coffee beans) whose details are uploaded onto ICE CoT. A product consignment may be uploaded at any point in the supply chain after it has been supplied by an aggregator. Each uploaded product consignment will require data regarding specified events between the aggregator supply and the point at which the product consignment is uploaded, including any transport, storage and processing of the product along the way.

The sequence of submitted event data can be used to track the commodities and products that comprise or are used to make the product consignment through the physical supply chain, back to the aggregators from which the relevant commodities or related products were sourced, and identifying the farm plots where the commodities were produced (a “traceability tree”). Each separate quantity of a single physical commodity or related product at each event along the traceability tree, starting with the initial supply by an aggregator, is called a “product parcel”.

The event types supported by ICE CoT include:

CreateParcel – sourcing of a product parcel from an aggregator. The start of every traceability tree, this provides the direct link to a list of eligible farmers identified in the farm plot data. Every subsequent event ultimately links back to a CreateParcel event.
Transport – movement of a product parcel, for example by truck.
Warehousing – storage of product parcel at a warehouse or other facility.
Operation – specified action carried out on a product parcel. For example, washing, processing beans into liquor, butter or powder at a factory, the splitting or merging of a product parcel/product parcels, and any ownership change.
Shipping – movement of product between countries associated with a bill of lading document. For the Shipping event, it is a requirement to upload selected details from the Bill of Lading document, and a scanned copy of the document.

Every event in the traceability tree for a product consignment must be identified by a numeric event ID, which determines the sequence in which events occurred. Events have lists of inputs and/or outputs defining the product acted on or produced by the event. The weight of each product parcel must be known at every stage in the supply chain.

Optional data may also be added including. Underlying systems and documentation to evidence the uploaded information are required to be available for inspection and verification.

Physical flow traceability data is not shared with a buyer or with other users except that: details regarding the immediate seller are always shared with a buyer; bill of lading information is shared with a buyer until due diligence statement creation, after which it is not shared; other physical flow traceability data may be shared with a buyer at the seller’s option.

ICE CoT currently supports file upload in a JSON format text file with a defined set of objects and fields.

Physical Flow Traceability Data Methodology Tests

ICE CoT applies consistency and reasonability tests to the physical flow traceability data under the Physical Flow Traceability Data Validation Methodology. All required data fields must be supplied.

ICE CoT Physical Flow Traceability Data Validation Methodology test methods and thresholds are subject to continuous review and may be updated, removed or added to.

The linkage of events and product parcels must form a consistent sequence in time
Event inputs and output product types must be consistent for the specified event type
Event inputs and output product weights must be consistent with the specified event type
Each identified aggregator must be from eligible list
Each identified facility must be from eligible list
Data relating to bills of lading will be checked against the document scan

Physical Flow Traceability Questionnaire

EUDR-compliant supply chains are expected to have in place systems and processes for warehousing or operational facilities to ensure compliance with required traceability requirements.

ICE CoT uses questionnaires to collect and analyse information regarding these systems and processes as they relate to making sure each product parcel is tracked through each warehousing and operational facility to ensure the identity of the input and output product parcel follows and corresponds with the provided physical flow traceability data, and that no mixing or contamination with unidentified product has occurred.

Relevant systems and documentation to evidence the answers to questionnaires must be available and may be inspected and verified.

Only warehousing and operational facilities with fully and satisfactorily completed questionnaires are eligible to be identified in the physical flow traceability data for any product consignment.

The ICE CoT badge symbolises a parcel that has all the required information and has passed the ICE CoT validation tests.

The badge may be shared with buyers, along with certain underlying information. ICE CoT will hold all information in relation to a parcel, which may be added to and shared as it moves along the supply chain.

Where required, a user can use ICE CoT to create and submit a due diligence statement to the EU.

ICE CoT uses a risk-based, third-party desk and field-based inspection and verification program to support the data collection and validation methodology processes described above.

All uploaded data, and all systems, processes and data confirmed to be present in questionnaire responses, must be available for inspection and verification on request to check its completeness, truthfulness and accuracy.

Data checks and control points will be identified regarding the ICE CoT data across farm plots, legality and risk systems and processes, and physical flow traceability for product consignments. Risk-based samples will be subject to field and desk-based inspection and verification processes in accordance with ICE CoT’s Data Inspection and Verification Program.

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ICE Commodity Traceability (ICE CoT) Service

Supporting trade in EU Deforestation Regulation (EUDR) compliant cocoa and coffee.

There are three key categories of data uploaded by users which are reviewed and validated by the ICE CoT methodologies:

Farm Plot Data

Lawful Production and Compliance Risk Data

Physical Flow Traceability Data

ICE CoT: Keeping EUDR-compliant cocoa and coffee tradeable

Farm Plot Data Methodology Tests

Registration Questionnaire

Legality and Risk Questionnaire

Risk Assessment Process

Physical Flow Traceability Data Methodology Tests

Physical Flow Traceability Questionnaire

List of Supported Origin Countries

Governance

Oversight Committee Meeting Minutes

News & Press Releases

News

Press Releases

Assurance Mechanism

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