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It was a groundbreaking regulation that would help stop the worldwide crisis 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 gutted," stated the law's original author, citing the exclusion of key obligations for later-stage companies to verify the provenance of commodities like palm oil, soy, wood, beef, rubber, cocoa and coffee.

Schally cautioned that fewer obligated actors, less information collected, and imprecise sourcing details would hinder monitoring and legal action.

A Watered-Down Law

Environmental MEP Marie Toussaint was more blunt, labeling 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 demands of more than a million EU citizens who supported an initiative in 2020 calling for a ban on deforestation-linked products.

When launched in 2021, then-Green Deal commissioner the European commissioner trumpeted it as "the most ambitious law proposed to combat deforestation."

A Story of Dilution

The regulation's dilution has been interpreted as the European Union retreating from its environmental promises. It faced two major postponements, reportedly over IT issues, which drew condemnation.

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

Originally, the regulation mandated that firms to track commodities back to their exact plot of land 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 explained. "It was the mechanism that ensured enforcement, 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 large companies, exporting nations, conservative political groups and EU logging states.

Experts cite last year's EU elections as a decisive moment, creating a new political majority less favorable toward green regulations.

"Additional intense pressure has come from big trading partners outside the EU," noted expert Andreas Rasche, implying the EU yielded to some demands in trade talks.

Key Loopholes Introduced

In the final legislation includes 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 opened for next spring.
• Only four countries – Russia, Belarus, North Korea and Myanmar – will face the strictest monitoring.

"Rather than strengthening rules for companies, it rolled them back," lamented the law's author. "Moving obligations to producers, it lessened the number of responsible firms."

Uncertainty for Companies

The protracted process and revisions have also caused frustration for companies that prepared in advance.

"It is very frustrating because we put a lot of effort into preparing," stated Xavier Rombouts. "We invested in software, followed seminars and built a team... now they’re saying it could be altered again. It’s a major letdown."

The Commission's Stance

A commission spokesperson supported the final law, saying: "The commission has responded to feedback and taken action to ensure a simple, fair and cost-efficient implementation."

"The new text provides for predictability, which is crucial for companies and national regulators to effectively enforce this vitally important regulation."