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Originally hailed as a pioneering regulation that would help stop the global 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 significantly diluted state, leading to criticism from its initial author and green lawmakers.

"The regulation was gutted," stated the law's original author, citing the removal of crucial requirements for later-stage companies to check the provenance of products like coffee, cocoa, beef, soy, palm oil, rubber and timber.

Schally cautioned that fewer obligated actors, fewer data points, and imprecise sourcing details would hinder monitoring and legal action.

A Watered-Down Law

Green party MEP a leading green politician went further, labeling the delays, loopholes and exemptions – such as one for paper goods – as the "political dismantling" of the law.

This final text stands in stark contrast to the demands of over 1.2 million European citizens who signed a petition in 2020 calling for a prohibition of goods linked to forest destruction.

When launched in 2021, the EU's climate chief the European commissioner called it "the toughest law proposed to combat deforestation."

A Story of Dilution

The regulation's dilution has been interpreted as the European Union retreating from its green talk. The proposal encountered significant delays, reportedly over technical problems, which drew condemnation.

"By revisiting the legislation instead of solving a simple IT problem, authorities invited political interference," remarked Toussaint.

Originally, the regulation mandated that firms to trace commodities back to their specific geographic origin using GPS coordinates, making them liable for forest loss along their supply lines with penalties and large financial penalties.

"It wasn't bureaucracy for its own sake," Schally said. "These rules were the tool that made the rules enforceable, established traceability, and stopped companies from hiding behind opaque production networks."

Mounting Pressure

Yet, the strict due diligence provoked opposition in Brussels from multinational corporations, exporting nations, conservative political groups and member states with forestry industries.

Analysts point to last year's European Parliament elections as a turning point, shifting the balance of power less favorable toward green regulations.

"The other pressure came from big trading partners outside the EU," said expert Andreas Rasche, implying the EU yielded to some demands in trade talks.

Key Loopholes Introduced

The passed law includes several critical weakenings:

• Downstream operators were mostly exempted from conducting rigorous checks.
• A new “low risk” category was created.
• A window for further "simplifications" was opened for next spring.
• Only four countries – geopolitical adversaries of the EU – will face the strictest monitoring.

"Instead of tightening rules for companies, it rolled them back," lamented the law's author. "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 invested significant resources into preparing," stated Xavier Rombouts. "We invested in software, followed seminars and built a team... now they’re saying it may be changed. It’s a big frustration."

Official Defense

A commission spokesperson supported the final law, saying: "The commission has responded to concerns and acted to ensure a pragmatic and balanced application."

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