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

However, the revised version of the European Union's anti-deforestation law, previously heralded as the crown jewel of the Green Deal, has been passed in a significantly diluted state, prompting alarm from its initial author and green lawmakers.

"The regulation was hollowed out," stated the law's original author, pointing to the removal of key obligations for later-stage companies to check the origin of products like coffee, cocoa, beef, soy, palm oil, rubber and timber.

Schally cautioned that fewer obligated actors, less information collected, and imprecise sourcing details would complicate the task of authorities.

A Watered-Down Law

Green party MEP a leading green politician was more blunt, labeling the postponements, exceptions and new loopholes – including one for printed products – as the "political dismantling" of the law.

This outcome is a far cry from the demands 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, the EU's climate chief the European commissioner trumpeted it as "the toughest legislation ever put forward to fight deforestation."

From Ambition to Compromise

The regulation's dilution is seen by critics as the European Union retreating from its green talk. The proposal encountered significant delays, reportedly over IT issues, which sparked criticism.

"By revisiting the legislation instead of solving a simple IT problem, the commission opened Pandora’s box," commented the Green MEP.

In its first draft, the law required companies to trace goods to their specific geographic origin using geolocation data, making them liable for forest loss along their supply lines with penalties and large financial penalties.

"This was not red tape for its own sake," the former official said. "It was the mechanism that ensured enforcement, established traceability, and prevented firms from obscuring their activities behind complex supply chains."

Intense Lobbying

However, the rigorous checks triggered a backlash in Brussels from multinational corporations, exporting nations, rightwing parties and member states with forestry industries.

Experts cite last year's European Parliament elections as a turning point, shifting the balance of power more skeptical of green regulations.

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

The Weakened Final Text

In the final legislation features several critical weakenings:

• Retailers and traders were mostly exempted from conducting rigorous checks.
• A new “low risk” category was created.
• A window for further "simplifications" was opened for next spring.
• Only four countries – Russia, Belarus, North Korea and Myanmar – will face “high risk” scrutiny.

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

Uncertainty for Companies

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

"It is very frustrating because we invested significant resources 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."

The Commission's Stance

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

"The new text ensures stability, which is key for business and competent authorities to effectively enforce this very important law."