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It was a landmark law that would help stop the global crisis of forest loss.

But, the final 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, leading to alarm from its initial author and green lawmakers.

"The regulation was stripped," said 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 fewer obligated actors, fewer data points, and less precise origin data would make enforcement and prosecution more difficult.

Political Dismantling

Green party vice-president a leading green politician went further, describing the delays, loopholes and exemptions – such as one for printed products – as the "systematic weakening" of the law.

This final text is a far cry from the hopes of over 1.2 million EU citizens who supported an initiative in 2020 calling for a ban on goods linked to forest destruction.

When launched in 2021, the EU's climate chief the European commissioner called it "the most ambitious legislation proposed to fight deforestation."

A Story of Dilution

The law's unravelling is seen by critics as the EU walking back its environmental promises. It faced significant delays, ostensibly over IT issues, which drew condemnation.

"By revisiting the legislation rather than fixing a simple IT problem, the commission opened Pandora’s box," commented Toussaint.

In its first draft, the regulation required companies to track goods back to their exact plot of land using GPS coordinates, holding them accountable for forest loss along their supply lines with penalties and large financial penalties.

"It wasn't bureaucracy for its own sake," the former official said. "It was the mechanism that made the rules enforceable, created a verifiable paper trail, and prevented firms from obscuring their activities behind opaque production networks."

Mounting Pressure

Yet, the strict due diligence provoked opposition in Brussels from multinational corporations, producer countries, conservative political groups and member states with forestry industries.

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

"Additional intense pressure came from big trading partners like the United States," noted expert Andreas Rasche, implying the EU yielded to some requests during negotiations.

Key Loopholes Introduced

The passed law features several critical weakenings:

• Retailers and traders were largely freed from conducting rigorous checks.
• A new “low risk” category was created.
• A window for further "simplifications" was opened for next spring.
• Only a handful of nations – geopolitical adversaries of the EU – will face the strictest monitoring.

"Rather than strengthening downstream obligations, it rolled them back," said Schally. "By shifting responsibilities to producers, it lessened the number of responsible firms."

Uncertainty for Companies

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

"It is very frustrating because we invested significant resources into preparing," said a coffee company executive. "We purchased systems, trained staff and established procedures... now they’re saying it could be altered again. It’s a major letdown."

The Commission's Stance

A commission spokesperson defended the outcome, stating: "The commission has responded to feedback and taken action to ensure a pragmatic and balanced implementation."

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