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Widely celebrated as a landmark regulation that would curb the global scourge of forest loss.

But, the revised version of the EU's deforestation regulation, once heralded as the flagship policy of the European Green Deal, has emerged in a severely weakened state, prompting alarm from its original architect and green lawmakers.

"It has been stripped," said Hugo Schally, citing the removal of key obligations for later-stage companies to verify the origin of products like coffee, cocoa, beef, soy, palm oil, rubber and timber.

He warned that a reduced number of responsible companies, fewer data points, and imprecise sourcing details would make enforcement and prosecution more difficult.

A Watered-Down Law

Green party MEP a leading green politician went further, describing the postponements, exceptions and new loopholes – including one for paper goods – as the "political dismantling" of the law.

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

At its launch in 2021, the EU's climate chief the European commissioner called it "the most ambitious law ever put forward to combat forest loss."

A Story of Dilution

The law's unravelling has been interpreted as the European Union retreating from its green talk. The proposal encountered significant delays, reportedly over technical problems, which sparked criticism.

"By reopening this file instead of solving a technical issue, the commission opened Pandora’s box," commented Toussaint.

Originally, the law mandated that firms to trace commodities back to their exact plot of land 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 ensured enforcement, created a verifiable paper trail, and prevented firms from obscuring their activities behind opaque production networks."

Intense Lobbying

However, the rigorous checks provoked opposition in the EU capital from multinational corporations, exporting nations, rightwing parties and EU logging states.

Analysts point to last year's EU elections as a decisive moment, shifting the balance of power less favorable toward environmental rules.

"The other pressure came from big trading partners outside the EU," noted corporate sustainability professor, implying the EU yielded to some demands in trade talks.

The Weakened Final Text

The passed law includes key dilutions:

• Downstream operators were largely freed 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 – Russia, Belarus, North Korea and Myanmar – will face “high risk” scrutiny.

"Instead of tightening downstream obligations, it rolled them back," said the law's author. "By shifting responsibilities to producers, it reduced accountability."

Uncertainty for Companies

The delays and changes have also created annoyance for companies that prepared in advance.

"It is very frustrating because we invested significant resources into preparing," said 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

An EU representative supported the final law, stating: "The commission has responded to concerns and taken action to ensure a pragmatic and balanced application."

"The new text ensures stability, which is key for business and national regulators to effectively enforce this very important regulation."