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Widely celebrated as a landmark piece of legislation that would combat the global crisis of deforestation.

But, the revised version of the EU's deforestation regulation, previously heralded as the flagship policy of the European Green Deal, has been passed in a significantly diluted state, leading to alarm from its original architect and green lawmakers.

"It has been hollowed out," said the law's original author, citing the exclusion of crucial requirements for later-stage companies to check the origin of commodities like coffee, cocoa, beef, soy, palm oil, rubber and timber.

He warned that fewer obligated actors, fewer data points, and less precise origin data would make enforcement and prosecution more difficult.

A Watered-Down Law

Green party vice-president a leading green politician was more blunt, describing the delays, loopholes and exemptions – such as one for printed products – as the "political dismantling" of the law.

This outcome stands in stark contrast to the demands 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 the European commissioner called it "the most ambitious law proposed to fight deforestation."

A Story of Dilution

The regulation's dilution is seen by critics as the European Union retreating from its green talk. It faced two major postponements, reportedly over IT issues, which drew condemnation.

"By reopening this file rather than fixing a simple IT problem, the commission opened Pandora’s box," commented the Green MEP.

Originally, the regulation mandated that firms to trace commodities to their exact plot of land using geolocation data, holding them accountable for deforestation in their supply chains with penalties and large financial penalties.

"This was not red tape for its own sake," Schally explained. "It was the mechanism that ensured enforcement, established traceability, and stopped companies from hiding behind opaque production networks."

Mounting Pressure

However, the rigorous checks provoked opposition in Brussels from multinational corporations, producer countries, conservative political groups and EU logging states.

Analysts point to last year's EU elections as a decisive moment, shifting the balance of power less favorable toward environmental rules.

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

The Weakened Final Text

In the final legislation features key dilutions:

• Retailers and traders were mostly exempted from submitting due diligence statements.
• A new “low risk” category 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 the strictest monitoring.

"Instead of tightening downstream obligations, it rolled them back," lamented the law's author. "By shifting responsibilities upstream, 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.

"We feel very annoyed because we put a lot of effort into complying," stated Xavier Rombouts. "We invested in software, followed seminars and built a team... now they’re saying it may be changed. It’s a big frustration."

Official Defense

An EU representative defended the outcome, saying: "We have listened to concerns and acted to ensure a simple, fair and cost-efficient application."

"The revised regulation provides for predictability, which is key for business and national regulators to successfully implement this vitally important law."