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Widely celebrated as a pioneering regulation that would curb the global scourge of deforestation.

But, the revised version of the EU's deforestation regulation, previously heralded as the crown jewel of the European Green Deal, has been passed in a significantly diluted state, prompting alarm from its original architect and green lawmakers.

"The regulation was hollowed out," stated the law's original author, pointing to the removal of crucial requirements for later-stage companies to check the provenance of products like coffee, cocoa, beef, soy, palm oil, rubber and timber.

Schally cautioned that a reduced number of responsible companies, fewer data points, and imprecise sourcing details would complicate the task of authorities.

A Watered-Down Law

Green party vice-president Marie Toussaint was more blunt, describing the delays, loopholes and exemptions – including one for paper goods – as the "systematic weakening" of the law.

This final text is a far cry from the hopes of more than a million EU citizens who signed a petition in 2020 demanding a prohibition of deforestation-linked products.

When launched in 2021, the EU's climate chief the European commissioner trumpeted it as "the toughest legislation proposed to fight forest loss."

From Ambition to Compromise

The law's unravelling is seen by critics as the European Union retreating from its green talk. The proposal encountered two major postponements, ostensibly over technical problems, which drew condemnation.

"By reopening this file rather than fixing a simple IT problem, the commission opened Pandora’s box," remarked the Green MEP.

In its first draft, the regulation required companies to track commodities to their exact plot of land using GPS coordinates, making them liable for forest loss along their supply lines with criminal charges and hefty fines.

"This was not red tape for its own sake," Schally explained. "These rules were the tool that ensured enforcement, created a verifiable paper trail, and stopped companies from hiding behind complex supply chains."

Mounting Pressure

Yet, the strict due diligence provoked opposition in Brussels from multinational corporations, exporting nations, conservative political groups and EU logging states.

Experts cite last year's EU elections as a decisive moment, shifting the balance of power more skeptical of green regulations.

"Additional intense pressure came 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 includes key dilutions:

• Downstream operators were largely freed from submitting due diligence statements.
• A new exemption for small operators was created.
• 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.

"Rather than strengthening rules for companies, it stripped them back," said Schally. "Moving obligations to producers, it lessened the number of responsible firms."

Business Frustration

The protracted process and revisions have also created annoyance for companies that prepared in advance.

"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 big frustration."

Official Defense

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 provides for predictability, which is key for business and competent authorities to effectively enforce this vitally important law."