The European Parliament voted 644-25 to outlaw illegal timber or products made from such wood, which makes up around one-fifth of all timber imports into the European Union, and punish unscrupulous dealers.

"With this, we are sending a signal to the world that the EU will no longer serve as a market for illegally harvested timber," said European Environment Commissioner Janez Potocnik.

Green member of the European Parliament Satu Hassi, who negotiated a deal with the 27 EU member states, called the legislation an "internationally important breakthrough."

The European Council must now formally approve the ban and it will take two years for the rules to take effect, as governments must draw up their own penalties to impose on lawbreakers.

The European legislation, which comes two years after the United States passed a similar law, closes a loophole in the industry. For it is currently not against the law to sell timber in the EU that was cut down illegally in its country of origin.

"Those who have been making a profit from illegal logging and destroying forests around the world have finally been given a good slap in the face," said Anke Schulmeister, EU forest policy officer at environmental group WWF.

More than half of logging activities take place in vulnerable regions such as the Amazon Basin, central Africa, southeast Asia and Russia, according to the European Union.

Illegally harvested timber represents 20 to 40 percent of global production of industrial wood, or 350 million to 650 million cubic metres (460 million to 850 million cubic yards), according to the UN.

The environmental group WWF estimated that in 2006 the EU imported around 30 million cubic metres of timber and wooden products made from illegal logging, mostly from Russia, China and Indonesia.

Under the new EU rules, importers will have to seek sufficient guarantees that the timber they are bringing in is legally harvested.

Traders such as furniture sellers must then make sure that the origin of the wood used to make their products is traceable.

While the legislation covers the 27-nation EU, it will be up to individual member states to set penalties for wrongdoers.

In drafting fines, governments can take into account the impact of the damage done by illegal logging to the environment, the value of the timber and the tax revenue that was lost.

It will also be up to individual governments to decide whether to "make the worst offences crimes," Hassi said.

The new rules will be implemented in 2012 to give national governments time to draft their own sets of sanctions and fines, she said.

Environmental groups have welcomed Europe's move to combat illegal logging, saying it would help curb climate change. Deforestation accounts for 20 percent of greenhouse gas emissions, according to the EU.

"We think that although the law is not perfect it is an important step forward," said Greenpeace EU forest policy director Sebastien Risso.

But they were diappointed the law was not coming into force immediately, he added.

"Greenpeace is altogether happy with the decision but we will remain vigilant because the adoption of the legislation is not the end point, it is the beginning."

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