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It was a groundbreaking law that would help stop the worldwide crisis of deforestation.

However, the revised version of the EU's deforestation regulation, previously heralded as the flagship policy of the European Green Deal, has been passed in a significantly diluted state, prompting alarm from its initial author and environmental politicians.

"The regulation was gutted," said the law's original author, citing the exclusion of key obligations for downstream traders to verify the provenance of commodities like coffee, cocoa, beef, soy, palm oil, rubber and timber.

He warned that fewer obligated actors, fewer data points, and imprecise sourcing details would complicate the task of authorities.

Political Dismantling

Green party vice-president a leading green politician was more blunt, labeling the delays, loopholes and exemptions – such as one for printed products – as the "political dismantling" of the law.

This outcome is a far cry from the demands of more than a million European citizens who supported an initiative in 2020 demanding 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 fight forest loss."

From Ambition to Compromise

The law's unravelling has been interpreted as the European Union retreating from its green talk. It faced two major postponements, reportedly over IT issues, which sparked criticism.

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

In its first draft, the regulation required companies to track commodities to their specific geographic origin using geolocation data, making them liable for forest loss along their supply lines with criminal charges and hefty fines.

"It wasn't bureaucracy for its own sake," Schally said. "These rules were the tool that ensured enforcement, created a verifiable paper trail, and prevented firms from obscuring their activities behind complex supply chains."

Mounting Pressure

Yet, the rigorous checks triggered a backlash in Brussels from large companies, exporting nations, conservative political groups and member states with forestry industries.

Analysts point to last year's EU elections as a turning point, creating a new political majority more skeptical of environmental rules.

"The other pressure has come from major export markets outside the EU," said corporate sustainability professor, suggesting the commission gave in to some demands in trade talks.

Key Loopholes Introduced

The passed law features several critical weakenings:

• Retailers and traders were largely freed from conducting rigorous checks.
• A new exemption for small operators was introduced.
• 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. "By shifting responsibilities to producers, it lessened the number of responsible firms."

Uncertainty for Companies

The delays and changes have also caused frustration for companies that prepared in advance.

"We feel very annoyed because we invested significant resources into complying," said Xavier Rombouts. "We purchased systems, trained staff and established procedures... now they’re saying it may be changed. It’s a major letdown."

Official Defense

An EU representative supported the final law, saying: "We have listened to feedback and taken action to ensure a simple, fair and cost-efficient application."

"The new text provides for predictability, which is crucial for companies and competent authorities to successfully implement this vitally important law."