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

But, the final version of the European Union's anti-deforestation law, previously heralded as the crown jewel of the European Green Deal, has been passed in a severely weakened state, leading to criticism from its initial author and environmental politicians.

"The regulation was hollowed out," stated the law's original author, pointing to the removal of crucial requirements for downstream traders to check the provenance of products like palm oil, soy, wood, beef, rubber, cocoa and coffee.

He warned that a reduced number of responsible companies, less information collected, and imprecise sourcing details would hinder monitoring and legal action.

A Watered-Down Law

Green party MEP Marie Toussaint went further, labeling 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 over 1.2 million EU citizens who supported an initiative in 2020 demanding a ban on goods linked to forest destruction.

At its launch in 2021, then-Green Deal commissioner the European commissioner trumpeted it as "the most ambitious legislation ever put forward to fight forest loss."

From Ambition to Compromise

The law's unravelling 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 technical issue, authorities invited political interference," commented Toussaint.

In its first draft, the law required companies to trace goods to their specific geographic origin using geolocation data, holding them accountable for deforestation in their supply chains with criminal charges and large financial penalties.

"It wasn't bureaucracy for its own sake," Schally said. "It was the mechanism that made the rules enforceable, established traceability, and stopped companies from hiding behind opaque production networks."

Mounting Pressure

Yet, the strict due diligence provoked opposition in the EU capital from large companies, exporting nations, conservative political groups and member states with forestry industries.

Analysts point to last year's European Parliament elections as a turning point, creating a new political majority more skeptical of environmental rules.

"The other pressure has come from big trading partners outside the EU," noted corporate sustainability professor, implying the commission gave in to some demands in trade talks.

The Weakened Final Text

The passed law includes key dilutions:

• Downstream operators were mostly exempted from submitting due diligence statements.
• A new “low risk” category was created.
• A option for more reductions was opened for next spring.
• Only a handful of nations – Russia, Belarus, North Korea and Myanmar – will face the strictest monitoring.

"Rather than strengthening downstream obligations, it rolled them back," said the law's author. "By shifting responsibilities to producers, it lessened the number of responsible firms."

Business Frustration

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

"We feel very annoyed because we invested significant resources into preparing," stated Xavier Rombouts. "We purchased systems, trained staff and established procedures... now they’re saying it may be changed. It’s a major letdown."

Official Defense

An EU representative defended the outcome, stating: "The commission has responded to concerns and acted to ensure a pragmatic and balanced implementation."

"The new text provides for predictability, which is key for business and competent authorities to effectively enforce this very important regulation."