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Widely celebrated as a groundbreaking law that would combat the worldwide scourge of forest loss.

However, the final version of the European Union's deforestation regulation, once touted as the flagship policy of the European Green Deal, has emerged in a significantly diluted state, leading to criticism from its original architect and green lawmakers.

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

He warned that a reduced number of responsible companies, fewer data points, and imprecise sourcing details would hinder monitoring and legal action.

A Watered-Down Law

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

This final text stands in stark contrast to the hopes of over 1.2 million European citizens who signed a petition in 2020 calling for a prohibition of deforestation-linked products.

At its launch in 2021, the EU's climate chief the European commissioner called it "the most ambitious legislation ever put forward to fight deforestation."

From Ambition to Compromise

The regulation's dilution has been interpreted as the EU walking back its environmental promises. The proposal encountered significant delays, ostensibly over technical problems, which sparked criticism.

"By revisiting the legislation instead of solving a simple IT problem, the commission opened Pandora’s box," commented Toussaint.

In its first draft, the law mandated that firms to trace goods to their exact plot of land using geolocation data, holding them accountable for forest loss along their supply lines with penalties and hefty fines.

"This was not red tape for its own sake," the former official said. "These rules were the tool that made the rules enforceable, established traceability, and stopped companies from hiding behind complex supply chains."

Intense Lobbying

However, the strict due diligence provoked opposition in Brussels from multinational corporations, exporting nations, rightwing parties and EU logging states.

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

"Additional intense pressure has come from major export markets outside the EU," noted corporate sustainability professor, implying the EU yielded to some requests during negotiations.

Key Loopholes Introduced

The passed law includes several critical weakenings:

• Retailers and traders were mostly exempted from submitting due diligence statements.
• A new “low risk” category was introduced.
• A window for further "simplifications" was opened for next spring.
• Only a handful of nations – geopolitical adversaries of the EU – will face the strictest monitoring.

"Instead of tightening downstream obligations, it rolled them back," said Schally. "By shifting responsibilities upstream, it reduced accountability."

Uncertainty for Companies

The protracted process and revisions have also created annoyance for businesses that complied early.

"We feel very annoyed because we put a lot of effort 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

A commission spokesperson defended the outcome, saying: "The commission has responded to feedback and taken action to ensure a pragmatic and balanced implementation."

"The revised regulation provides for predictability, which is crucial for companies and competent authorities to successfully implement this very important regulation."