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Widely celebrated as a landmark piece of legislation that would help stop the global crisis of deforestation.

However, the revised version of the European Union's deforestation regulation, once touted as the crown jewel of the European Green Deal, has been passed in a significantly diluted state, prompting alarm from its initial author and green lawmakers.

"It has been gutted," stated the law's original author, pointing to the removal of crucial requirements for downstream traders to check the provenance of commodities like coffee, cocoa, beef, soy, palm oil, rubber and timber.

He warned that fewer obligated actors, fewer data points, and less precise origin data would hinder monitoring and legal action.

Political Dismantling

Environmental MEP a leading green politician went further, labeling the postponements, exceptions and new loopholes – including one for printed products – as the "systematic weakening" of the law.

This final text is a far cry from the demands of more than a million EU citizens who supported an initiative in 2020 demanding a ban on goods linked to forest destruction.

When launched in 2021, then-Green Deal commissioner the European commissioner trumpeted it as "the most ambitious legislation ever put forward to combat deforestation."

From Ambition to Compromise

The regulation's dilution is seen by critics as the EU walking back its green talk. It faced two major postponements, reportedly over technical problems, which sparked criticism.

"By revisiting the legislation instead of solving a technical issue, the commission opened Pandora’s box," commented the Green MEP.

In its first draft, the law required companies to trace commodities back to their exact plot of land using geolocation data, making them liable for deforestation in their supply chains with penalties and large financial penalties.

"This was not red tape for its own sake," Schally explained. "These rules were the tool that made the rules enforceable, established traceability, and stopped companies from hiding behind opaque production networks."

Mounting Pressure

However, the rigorous checks triggered a backlash in Brussels from large companies, producer countries, conservative political groups and EU logging states.

Experts cite last year's EU elections as a turning point, shifting the balance of power less favorable toward environmental rules.

"The other pressure came from major export markets outside the EU," noted corporate sustainability professor, suggesting the EU yielded to some demands in trade talks.

The Weakened Final Text

In the final legislation features key dilutions:

• Downstream operators were largely freed from submitting due diligence statements.
• A new exemption for small operators was created.
• A option for more reductions was established for next spring.
• Only four countries – geopolitical adversaries of the EU – will face “high risk” scrutiny.

"Rather than strengthening downstream obligations, it stripped them back," lamented Schally. "Moving obligations to producers, it reduced accountability."

Uncertainty for Companies

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

"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 could be altered again. It’s a major letdown."

The Commission's Stance

A commission spokesperson supported the final law, stating: "We have listened to concerns and acted to ensure a simple, fair and cost-efficient implementation."

"The revised regulation ensures stability, which is key for business and competent authorities to successfully implement this very important regulation."