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Originally hailed as a pioneering piece of legislation that would help stop the global crisis of forest loss.

However, the final version of the EU's deforestation regulation, once heralded as the crown jewel of the Green Deal, has been passed in a significantly diluted state, prompting criticism from its initial author and environmental politicians.

"It has been hollowed out," stated the law's original author, citing the exclusion of crucial requirements for downstream traders to verify the provenance of products like coffee, cocoa, beef, soy, palm oil, rubber and timber.

Schally cautioned that fewer obligated actors, less information collected, and less precise origin data would complicate the task of authorities.

Political Dismantling

Environmental vice-president Marie Toussaint went further, labeling the postponements, exceptions and new loopholes – including one for paper goods – as the "political dismantling" of the law.

This final text is a far cry from the hopes of over 1.2 million EU citizens who signed a petition in 2020 demanding a prohibition of goods linked to forest destruction.

When launched in 2021, the EU's climate chief the European commissioner trumpeted it as "the most ambitious legislation proposed to fight deforestation."

From Ambition to Compromise

The law's unravelling has been interpreted as the EU walking back its environmental promises. The proposal encountered significant delays, reportedly over technical problems, which drew condemnation.

"By reopening this file rather than fixing a technical issue, the commission opened Pandora’s box," commented Toussaint.

Originally, the regulation required companies to track goods back to their specific geographic origin using GPS coordinates, holding them accountable for forest loss along their supply lines with criminal charges and large financial penalties.

"This was not red tape 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 strict due diligence provoked opposition in the EU capital from multinational corporations, exporting nations, conservative political groups and member states with forestry industries.

Analysts point to last year's EU elections as a decisive moment, creating a new political majority 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 requests during negotiations.

The Weakened Final Text

The passed law includes several critical weakenings:

• Retailers and traders were largely freed from submitting due diligence statements.
• A new “low risk” category was introduced.
• A option for more reductions was established for next spring.
• Only four countries – geopolitical adversaries of the EU – will face the strictest monitoring.

"Rather than strengthening downstream obligations, it rolled them back," said Schally. "By shifting responsibilities to producers, it lessened the number of responsible firms."

Uncertainty for Companies

The protracted process and revisions have also caused frustration for companies that prepared in advance.

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

Official Defense

A commission spokesperson defended the outcome, stating: "We have listened to concerns and acted to ensure a simple, fair and cost-efficient application."

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