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It was a pioneering law that would curb the global crisis of deforestation.

However, the revised version of the EU's deforestation regulation, once touted as the crown jewel of the European Green Deal, has emerged in a significantly diluted state, leading to criticism from its initial author and green lawmakers.

"The regulation was stripped," stated Hugo Schally, pointing to the removal of key obligations for downstream traders to verify the provenance of commodities like palm oil, soy, wood, beef, rubber, cocoa and coffee.

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

Green party vice-president a leading green politician went further, labeling the postponements, exceptions and new loopholes – such as one for paper goods – as the "political dismantling" of the law.

This outcome stands in stark contrast to the hopes of more than a million European citizens who signed a petition in 2020 calling for a ban on goods linked to forest destruction.

When launched in 2021, then-Green Deal commissioner Frans Timmermans called it "the toughest legislation ever put forward to fight deforestation."

From Ambition to Compromise

The regulation's dilution has been interpreted as the European Union retreating from its environmental promises. The proposal encountered two major postponements, reportedly over technical problems, which sparked criticism.

"By reopening this file instead of solving a simple IT problem, the commission opened Pandora’s box," remarked the Green MEP.

Originally, the regulation required companies to trace commodities to their specific geographic origin 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 explained. "These rules were the tool that made the rules enforceable, established traceability, and stopped companies from hiding behind opaque production networks."

Intense Lobbying

However, the strict due diligence triggered a backlash in the EU capital from large companies, producer countries, rightwing parties and EU logging states.

Experts cite last year's European Parliament elections as a turning point, creating a new political majority less favorable toward environmental rules.

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

The Weakened Final Text

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 created.
• A window for further "simplifications" was established for next spring.
• Only a handful of nations – Russia, Belarus, North Korea and Myanmar – will face “high risk” scrutiny.

"Rather than strengthening downstream obligations, it stripped them back," lamented Schally. "Moving obligations to producers, it lessened the number of responsible firms."

Business Frustration

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 complying," said a coffee company executive. "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: "The commission has responded to concerns and taken action to ensure a pragmatic and balanced implementation."

"The new text provides for predictability, which is key for business and competent authorities to successfully implement this vitally important law."