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It was a landmark law that would combat the worldwide scourge of deforestation.

However, the final version of the EU's deforestation regulation, previously touted as the flagship policy of the Green Deal, has emerged in a significantly diluted state, leading to alarm from its initial author and environmental politicians.

"The regulation was hollowed out," said Hugo Schally, citing the exclusion of key obligations for downstream traders to verify the provenance of products like palm oil, soy, wood, beef, rubber, cocoa and coffee.

Schally cautioned that fewer obligated actors, less information collected, and less precise origin data would make enforcement and prosecution more difficult.

Political Dismantling

Environmental vice-president a leading green politician went further, describing the postponements, exceptions and new loopholes – including one for printed products – as the "political dismantling" of the law.

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

At its launch in 2021, then-Green Deal commissioner Frans Timmermans called it "the most ambitious legislation ever put forward to fight deforestation."

From Ambition to Compromise

The law's unravelling has been interpreted as the European Union retreating from its green talk. The proposal encountered two major postponements, ostensibly over technical problems, which sparked criticism.

"By reopening this file rather than fixing a simple IT problem, authorities invited political interference," commented Toussaint.

In its first draft, the regulation mandated that firms to trace goods to their exact plot of land using geolocation data, holding them accountable for deforestation in their supply chains with penalties and hefty fines.

"It wasn't bureaucracy for its own sake," Schally said. "These rules were the tool that ensured enforcement, created a verifiable paper trail, and stopped companies from hiding behind complex supply chains."

Mounting Pressure

Yet, the rigorous checks triggered a backlash in Brussels from large companies, producer countries, rightwing parties 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 green regulations.

"Additional intense pressure has come from major export markets like the United States," noted expert Andreas Rasche, suggesting the EU yielded to some demands in trade talks.

The Weakened Final Text

In the final legislation features key dilutions:

• Downstream operators 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 “high risk” scrutiny.

"Rather than strengthening rules for companies, it stripped them back," said the law's author. "Moving obligations to producers, it reduced accountability."

Business Frustration

The protracted process and revisions have also caused frustration for companies that prepared in advance.

"We feel very annoyed 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 may be changed. It’s a major letdown."

The Commission's Stance

An EU representative defended the outcome, stating: "The commission has responded to feedback and taken action to ensure a pragmatic and balanced application."

"The revised regulation ensures stability, which is key for business and national regulators to effectively enforce this vitally important law."