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Widely celebrated as a landmark regulation that would curb the worldwide crisis of deforestation.

However, the final version of the European Union's anti-deforestation law, previously touted as the flagship policy of the European Green Deal, has been passed in a severely weakened state, prompting alarm from its original architect and environmental politicians.

"The regulation was hollowed out," said Hugo Schally, citing the exclusion of crucial requirements for downstream traders to check the provenance of commodities like coffee, cocoa, beef, soy, palm oil, rubber and timber.

Schally cautioned that fewer obligated actors, fewer data points, and imprecise sourcing details would complicate the task of authorities.

Political Dismantling

Green party MEP Marie Toussaint was more blunt, describing the postponements, exceptions and new loopholes – such as one for printed products – as the "systematic weakening" of the law.

This final text stands in stark contrast to the demands 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 Frans Timmermans called it "the most ambitious 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 two major postponements, reportedly over IT issues, which sparked criticism.

"By revisiting the legislation rather than fixing a technical issue, the commission opened Pandora’s box," commented the Green MEP.

Originally, the law required companies to trace goods back to their exact plot of land using geolocation data, making them liable 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 made the rules enforceable, established traceability, and prevented firms from obscuring their activities behind complex supply chains."

Mounting Pressure

Yet, the rigorous checks provoked opposition 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, creating a new political majority less favorable toward environmental rules.

"The other pressure has come from major export markets outside the EU," noted corporate sustainability professor, suggesting the EU yielded to some requests during negotiations.

The Weakened Final Text

In the final legislation includes key dilutions:

• Retailers and traders were largely freed from conducting rigorous checks.
• A new “low risk” category was created.
• A window for further "simplifications" was opened for next spring.
• Only four countries – geopolitical adversaries of the EU – will face the strictest monitoring.

"Instead of tightening rules for companies, it stripped them back," lamented the law's author. "Moving obligations upstream, it reduced accountability."

Uncertainty for Companies

The delays and changes have also created annoyance for businesses that complied early.

"It is very frustrating because we invested significant resources 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

A commission spokesperson supported the final law, saying: "We have listened to concerns and taken action to ensure a simple, fair and cost-efficient application."

"The new text ensures stability, which is key for business and competent authorities to successfully implement this very important regulation."