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It was a pioneering regulation that would combat the worldwide crisis of deforestation.

However, the final version of the European Union's deforestation regulation, previously heralded as the crown jewel of the European Green Deal, has emerged in a significantly diluted state, prompting criticism from its original architect and green lawmakers.

"The regulation was stripped," stated Hugo Schally, pointing to the exclusion of crucial requirements for later-stage companies to check the provenance of commodities like palm oil, soy, wood, beef, rubber, cocoa and coffee.

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

A Watered-Down Law

Green party MEP a leading green politician went further, describing the postponements, exceptions and new loopholes – including one for paper goods – as the "systematic weakening" of the law.

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

At its launch in 2021, the EU's climate chief Frans Timmermans called it "the most ambitious law proposed to combat deforestation."

From Ambition to Compromise

The law's unravelling has been interpreted as the European Union retreating from its environmental promises. The proposal encountered significant delays, reportedly over IT issues, which drew condemnation.

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

In its first draft, the regulation required companies to trace goods to their specific geographic origin using GPS coordinates, making them liable for forest loss along their supply lines with criminal charges and hefty fines.

"This was not red tape for its own sake," Schally said. "It was the mechanism that ensured enforcement, created a verifiable paper trail, and stopped companies from hiding behind opaque production networks."

Intense Lobbying

Yet, the rigorous checks triggered a backlash in the EU capital from multinational corporations, producer countries, rightwing parties and member states with forestry industries.

Experts cite last year's EU elections as a decisive moment, shifting the balance of power less favorable toward environmental rules.

"The other pressure came from major export markets like the United States," noted expert Andreas Rasche, implying the commission gave in to some requests during negotiations.

The Weakened Final Text

In the final legislation features key dilutions:

• Downstream operators were largely freed from submitting due diligence statements.
• A new exemption for small operators was introduced.
• A window for further "simplifications" was established for next spring.
• Only a handful of nations – geopolitical adversaries of the EU – will face the strictest monitoring.

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

Business Frustration

The delays and changes have also created annoyance for companies that prepared in advance.

"It is very frustrating because we put a lot of effort into preparing," said Xavier Rombouts. "We invested in software, followed seminars and built a team... 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 feedback and taken action to ensure a simple, fair and cost-efficient implementation."

"The revised regulation provides for predictability, which is crucial for companies and national regulators to effectively enforce this very important law."