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Originally hailed as a landmark regulation that would combat the worldwide scourge of forest loss.

However, the revised version of the EU's deforestation regulation, once heralded as the flagship policy of the European Green Deal, has been passed in a severely weakened state, prompting criticism from its original architect and green lawmakers.

"It has been stripped," stated Hugo Schally, pointing to the exclusion of key obligations for downstream traders to verify the origin of commodities like palm oil, soy, wood, beef, rubber, cocoa and coffee.

Schally cautioned that a reduced number of responsible companies, fewer data points, and less precise origin data would make enforcement and prosecution more difficult.

A Watered-Down Law

Environmental MEP Marie Toussaint went further, describing the delays, loopholes and exemptions – such as one for paper goods – as the "systematic weakening" of the law.

This final text 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.

When launched in 2021, the EU's climate chief the European commissioner called it "the toughest legislation ever put forward to fight deforestation."

A Story of Dilution

The regulation's dilution is seen by critics as the European Union retreating from its environmental promises. It faced two major postponements, reportedly over technical problems, which drew condemnation.

"By revisiting the legislation instead of solving a simple IT problem, authorities invited political interference," commented the Green MEP.

Originally, the regulation mandated that firms to trace commodities to their exact plot of land using GPS coordinates, holding them accountable for forest loss along their supply lines with penalties and hefty fines.

"It wasn't bureaucracy for its own sake," the former official 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 multinational corporations, producer countries, conservative political groups and member states with forestry industries.

Analysts point to last year's European Parliament elections as a turning point, shifting the balance of power more skeptical of environmental rules.

"The other pressure came from major export markets outside the EU," said corporate sustainability professor, implying the commission gave in to some requests during negotiations.

Key Loopholes Introduced

The passed law features key dilutions:

• Downstream operators were mostly exempted from submitting due diligence statements.
• A new exemption for small operators was created.
• A option for more reductions was established for next spring.
• Only a handful of nations – Russia, Belarus, North Korea and Myanmar – will face “high risk” scrutiny.

"Instead of tightening downstream obligations, it stripped them back," said the law's author. "Moving obligations to producers, it reduced accountability."

Uncertainty for Companies

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

"It is very frustrating because we put a lot of effort 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 big frustration."

The Commission's Stance

An EU representative 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 key for business and competent authorities to successfully implement this vitally important regulation."