KUALA LUMPUR: Malaysia is upgrading its timber legality framework to meet a future in which exporters must prove not just legality but also exact geolocation and deforestation-free sourcing, or risk losing access to key markets.
“In the future, everyone is asking about ESG,” said Sunita Muhamad of the Malaysian Timber Industry Board (MTIB).
“So we are upgrading Malaysia Timber Legality Assurance System (MTLAS) to include ESG elements, geolocation and scientific naming.”
Her remarks come as the European Union moves towards full enforcement of its Deforestation-Free Regulation (EUDR) by end-2026, requiring exporters to provide precise geographic coordinates of where timber was harvested, alongside proof that products are not linked to deforestation.
At the centre of Malaysia’s response is the MTLAS, a government-backed framework designed to safeguard export access in increasingly regulated markets.
“MTLAS is not a certification scheme. It is a government legality assurance system, and it is voluntary. Usually, buyers request it,” Sunita said during a briefing at the Malaysian International Furniture Fair 2026 yesterday.
While voluntary, the system has become a de facto entry pass for exporters shipping to the EU.
“If you do not comply, we will not allow you to export, especially to destinations like the EU. That is a high risk for the company,” she said.
Since its introduction in 2013, more than 150,000 MTLAS certificates have been issued, with over 150 companies currently using the system. Initially designed for EU-bound shipments, demand has widened.
“After a few years, many companies requested MTLAS to export to the US, Japan, Australia and the UK,” Sunita said.
The shift reflects tightening global scrutiny. Under the new EU rules, exporters must submit geolocation data that can be mapped digitally, going beyond traditional documentation stating only the state or district of origin.
“They want to know exactly where the trees were harvested. You must provide coordinates,” she said.
Malaysia’s existing traceability mechanism includes the removal pass issued by the Forestry Department upon the exit of logs from concession areas. This document accompanies timber throughout the supply chain, from the forest to the mill to the export point.
MTLAS integrates enforcement across nine government agencies and is anchored by seven key Acts that cover forest management, harvesting licences, mill operations, worker welfare, environmental safeguards, and community considerations.
“Every single step is regulated and documented,” Sunita said.
As part of preparations for EUDR enforcement, MTIB has introduced an enhanced MTLAS-EUDR framework and conducted trial runs since September 2025 to familiarise exporters with the new requirements.
“So far, we have issued about 150 MTLAS-EUDR certificates to the EU, and they have been accepted,” she said.
The enhanced system integrates forest concession mapping with harvesting documentation, backed by a centralised database under MTIB.
Cross-verification among agencies and digitalised inspection records aims to strengthen due diligence processes and risk profiling of operators.
Companies are categorised into risk levels, and exporters must submit due diligence statements for screening.
For non-compliance, enforcement is corrective but firm.
“Normally, we issue a warning letter and educate them on what needs to be fulfilled. But if you want to export to regulated markets, compliance is mandatory,” Sunita said.
The strategic push comes as timber remains Malaysia’s third-largest export commodity after palm oil and rubber.
In 2024, timber exports rose 4.9% year-on-year to RM22.9 billion, rebounding from a dip in 2023. Wooden furniture led exports at RM9.9 billion, followed by plywood and sawn timber.
With annual export values hovering between RM22 billion and RM23 billion and thousands of SMEs dependent on the sector, maintaining market access is seen as critical.
“Maintaining international market access is not merely regulatory. It is an economic strategy. MTLAS protects national interest,” Sunita said.
As ESG benchmarks become embedded into trade policies, Malaysia is positioning its government-backed legality system as a competitive advantage, offering buyers state-assured traceability in a market increasingly wary of deforestation-linked supply chains.
“MTLAS is more than compliance,” Sunita said. “It ensures Malaysian timber remains trusted, compliant and globally competitive.”
With deforestation-free rules reshaping the global timber trade, Malaysia’s bet is clear: turn regulatory pressure into a structured, tech-driven export shield before enforcement deadlines become trade barriers.

 The Sun Malaysia