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Originally hailed as a pioneering regulation that would help stop the worldwide crisis of forest loss.

However, the revised version of the EU's deforestation regulation, previously touted as the crown jewel of the Green Deal, has been passed in a severely weakened state, prompting alarm from its original architect and environmental politicians.

"The regulation was stripped," stated the law's original author, pointing to the exclusion of key obligations for downstream traders to verify the origin of products like palm oil, soy, wood, beef, rubber, cocoa and coffee.

He warned that a reduced number of responsible companies, less information collected, and imprecise sourcing details would make enforcement and prosecution more difficult.

A Watered-Down Law

Environmental MEP a leading green politician was more blunt, describing the delays, loopholes and exemptions – including one for paper goods – as the "systematic weakening" of the law.

This outcome stands in stark contrast to the hopes of more than a million European citizens who supported an initiative in 2020 calling for a ban on goods linked to forest destruction.

At its launch in 2021, the EU's climate chief Frans Timmermans trumpeted it as "the most ambitious law ever put forward to combat deforestation."

From Ambition to Compromise

The law's unravelling has been interpreted as the European Union retreating from its environmental promises. The proposal encountered two major postponements, ostensibly over technical problems, which drew condemnation.

"By reopening this file instead of solving a simple IT problem, the commission opened Pandora’s box," remarked the Green MEP.

In its first draft, the law mandated that firms to trace goods to their exact plot of land using geolocation data, holding them accountable for deforestation in their supply chains with criminal charges and hefty fines.

"It wasn't bureaucracy for its own sake," Schally explained. "It was the mechanism that ensured enforcement, established traceability, and stopped companies from hiding behind complex supply chains."

Intense Lobbying

However, the rigorous checks triggered a backlash in Brussels from large companies, exporting nations, rightwing parties and EU logging states.

Analysts point to last year's EU elections as a turning point, shifting the balance of power more skeptical of green regulations.

"The other pressure has come from major export markets like the United States," said corporate sustainability professor, implying the commission gave in to some demands in trade talks.

The Weakened Final Text

In the final legislation features key dilutions:

• Retailers and traders were mostly exempted from submitting due diligence statements.
• A new exemption for small operators was created.
• A option for more reductions was opened for next spring.
• Only a handful of nations – geopolitical adversaries of the EU – will face “high risk” scrutiny.

"Instead of tightening downstream obligations, it stripped them back," lamented Schally. "By shifting responsibilities upstream, it lessened the number of responsible firms."

Uncertainty for Companies

The delays and changes have also created annoyance for businesses that complied early.

"It is very frustrating because we put a lot of effort into preparing," stated Xavier Rombouts. "We purchased systems, trained staff and established procedures... now they’re saying it may be changed. It’s a major letdown."

The Commission's Stance

A commission spokesperson supported the final law, saying: "We have listened to feedback and acted to ensure a pragmatic and balanced implementation."

"The revised regulation provides for predictability, which is key for business and competent authorities to effectively enforce this very important law."