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Widely celebrated as a groundbreaking law that would curb the worldwide crisis of deforestation.

But, the final version of the EU's deforestation regulation, once touted as the flagship policy of the Green Deal, has been passed in a severely weakened state, prompting criticism from its initial author and environmental politicians.

"The regulation was stripped," said Hugo Schally, pointing to the exclusion of key obligations for downstream traders to check the origin of commodities like palm oil, soy, wood, beef, rubber, cocoa and coffee.

Schally cautioned that fewer obligated actors, fewer data points, and imprecise sourcing details would hinder monitoring and legal action.

Political Dismantling

Green party MEP a leading green politician was more blunt, labeling the delays, loopholes and exemptions – including one for paper goods – as the "political dismantling" of the law.

This final text is a far cry from the hopes of over 1.2 million European citizens who signed a petition in 2020 calling for a prohibition of deforestation-linked products.

When launched in 2021, then-Green Deal commissioner Frans Timmermans called it "the most ambitious legislation proposed to combat forest loss."

A Story of Dilution

The regulation's dilution is seen by critics as the EU walking back its environmental promises. It faced two major postponements, ostensibly 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.

In its first draft, the regulation required companies to track commodities back to their specific geographic origin using geolocation data, making them liable for forest loss along their supply lines with criminal charges and hefty fines.

"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 triggered a backlash in the EU capital from large companies, exporting nations, conservative political groups and EU logging states.

Experts cite last year's EU elections as a turning point, creating a new political majority more skeptical of environmental rules.

"The other pressure came from major export markets outside the EU," said expert Andreas Rasche, suggesting the commission gave in to some requests during negotiations.

Key Loopholes Introduced

The passed law features several critical weakenings:

• Downstream operators were mostly exempted from submitting due diligence statements.
• A new exemption for small operators was introduced.
• A option for more reductions was established 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," lamented Schally. "By shifting responsibilities to producers, it lessened the number of responsible firms."

Uncertainty for Companies

The protracted process and revisions have also caused frustration for businesses that complied early.

"We feel very annoyed because we put a lot of effort into complying," said a coffee company executive. "We purchased systems, trained staff and established procedures... now they’re saying it may be changed. It’s a big frustration."

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 application."

"The new text ensures stability, which is crucial for companies and competent authorities to successfully implement this vitally important regulation."