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Originally hailed as a landmark law that would help stop the global crisis of deforestation.

However, the final version of the EU's deforestation regulation, once touted as the flagship policy of the European Green Deal, has been passed in a severely weakened state, leading to alarm from its initial author and environmental politicians.

"The regulation was stripped," said the law's original author, pointing to the removal of key obligations for later-stage companies to check the origin of commodities like coffee, cocoa, beef, soy, palm oil, rubber and timber.

Schally cautioned that a reduced number of responsible companies, fewer data points, and less precise origin data would complicate the task of authorities.

Political Dismantling

Environmental MEP Marie Toussaint went further, labeling the postponements, exceptions and new loopholes – including one for paper goods – as the "political dismantling" of the law.

This final text is a far cry from the hopes of more than a million European citizens who signed a petition in 2020 calling for a ban on deforestation-linked products.

When launched in 2021, then-Green Deal commissioner the European commissioner called it "the toughest legislation ever put forward to fight forest loss."

From Ambition to Compromise

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

"By reopening this file instead of solving a technical issue, authorities invited political interference," commented Toussaint.

In its first draft, the regulation mandated that firms to trace commodities to their specific geographic origin using GPS coordinates, holding them accountable for deforestation in their supply chains with criminal charges and large financial penalties.

"This was not red tape for its own sake," Schally said. "It was the mechanism that ensured enforcement, created a verifiable paper trail, and prevented firms from obscuring their activities behind opaque production networks."

Intense Lobbying

Yet, the strict due diligence provoked opposition in Brussels from large companies, producer countries, conservative political groups and EU logging states.

Analysts point to last year's EU elections as a turning point, shifting the balance of power less favorable toward green regulations.

"The other pressure has come from big trading partners outside the EU," noted expert Andreas Rasche, implying the commission gave in to some demands in trade talks.

Key Loopholes Introduced

In the final legislation includes key dilutions:

• Retailers and traders were largely freed from conducting rigorous checks.
• A new exemption for small operators was created.
• A option for more reductions was established for next spring.
• Only four countries – geopolitical adversaries of the EU – will face the strictest monitoring.

"Instead of tightening downstream obligations, it rolled them back," lamented the law's author. "Moving obligations 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 invested significant resources into preparing," 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, stating: "We have listened to concerns and acted to ensure a pragmatic and balanced application."

"The new text ensures stability, which is crucial for companies and competent authorities to successfully implement this very important law."