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

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

"The regulation was gutted," said the law's original author, pointing to the removal of crucial requirements for later-stage companies to verify the origin of products like palm oil, soy, wood, beef, rubber, cocoa and coffee.

Schally cautioned that a reduced number of responsible companies, less information collected, 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 delays, loopholes and exemptions – such as one for printed products – as the "political dismantling" of the law.

This outcome stands in stark contrast to the hopes of over 1.2 million EU citizens who supported an initiative in 2020 demanding a ban on goods linked to forest destruction.

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

From Ambition to Compromise

The law's unravelling has been interpreted as the European Union retreating from its green talk. It faced significant delays, reportedly over IT issues, which drew condemnation.

"By revisiting the legislation rather than fixing a simple IT problem, authorities invited political interference," remarked the Green MEP.

Originally, the law mandated that firms to track goods to their specific geographic origin using geolocation data, holding them accountable for deforestation in their supply chains with penalties and hefty fines.

"This was not red tape for its own sake," Schally explained. "It was the mechanism that ensured enforcement, established traceability, and stopped companies from hiding behind complex supply chains."

Mounting Pressure

However, the strict due diligence provoked opposition in Brussels from large companies, producer countries, conservative political groups and member states with forestry industries.

Experts cite last year's EU elections as a turning point, shifting the balance of power more skeptical of environmental rules.

"Additional intense pressure came from big trading partners like the United States," noted corporate sustainability professor, suggesting the EU yielded to some requests during negotiations.

Key Loopholes Introduced

The passed law includes several critical weakenings:

• Downstream operators were largely freed from conducting rigorous checks.
• A new “low risk” category was introduced.
• A option for more reductions was established for next spring.
• Only four countries – Russia, Belarus, North Korea and Myanmar – will face the strictest monitoring.

"Rather than strengthening rules for companies, it stripped them back," said the law's author. "By shifting responsibilities to producers, it lessened the number of responsible firms."

Business Frustration

The delays and changes have also caused frustration for businesses that complied early.

"It is very frustrating because we invested significant resources into complying," said a coffee company executive. "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 ensures stability, which is crucial for companies and competent authorities to effectively enforce this vitally important regulation."