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It was a pioneering law that would help stop the worldwide crisis of forest loss.

But, the final version of the EU's deforestation regulation, once touted as the flagship policy of the European Green Deal, has emerged in a severely weakened state, leading to alarm from its initial author and green lawmakers.

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

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

Political Dismantling

Environmental vice-president a leading green politician went further, labeling the delays, loopholes and exemptions – such as one for printed products – as the "political dismantling" of the law.

This final text stands in stark contrast to the hopes of over 1.2 million EU citizens who supported an initiative in 2020 calling for a ban on goods linked to forest destruction.

At its launch in 2021, then-Green Deal commissioner Frans Timmermans trumpeted it as "the toughest legislation proposed to fight forest loss."

From Ambition to Compromise

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

"By revisiting the legislation instead of solving a technical issue, authorities invited political interference," commented the Green MEP.

Originally, the law required companies to track commodities to their exact plot of land using geolocation data, holding them accountable for deforestation in their supply chains with penalties and hefty fines.

"This was not red tape for its own sake," Schally said. "It was the mechanism that made the rules enforceable, created a verifiable paper trail, and stopped companies from hiding behind complex supply chains."

Mounting Pressure

Yet, the strict due diligence triggered a backlash in the EU capital from multinational corporations, producer countries, 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 environmental rules.

"The other pressure has come from big trading partners like the United States," noted corporate sustainability professor, implying the EU yielded to some demands in trade talks.

Key Loopholes Introduced

The passed law features key dilutions:

• Downstream operators were largely freed from submitting due diligence statements.
• A new exemption for small operators was introduced.
• A window for further "simplifications" was opened for next spring.
• Only a handful of nations – geopolitical adversaries of the EU – will face “high risk” scrutiny.

"Instead of tightening rules for companies, it stripped them back," lamented the law's author. "Moving obligations to producers, it reduced accountability."

Business Frustration

The delays and changes have also caused frustration for businesses that complied early.

"We feel very annoyed because we invested significant resources into complying," 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 concerns and acted to ensure a pragmatic and balanced application."

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