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Widely celebrated as a groundbreaking regulation that would curb the worldwide scourge of deforestation.

But, the final version of the European Union's deforestation regulation, previously heralded as the flagship policy of the European Green Deal, has been passed in a severely weakened state, leading to alarm from its initial author and environmental politicians.

"The regulation was hollowed out," stated Hugo Schally, citing the removal of crucial requirements for downstream traders to verify the provenance of products like coffee, cocoa, beef, soy, palm oil, rubber and timber.

He warned that a reduced number of responsible companies, fewer data points, and imprecise sourcing details would hinder monitoring and legal action.

A Watered-Down Law

Environmental MEP a leading green politician went further, describing the delays, loopholes and exemptions – such as one for paper goods – as the "political dismantling" of the law.

This final text is a far cry from the demands of over 1.2 million EU citizens who supported an initiative in 2020 calling for a ban on goods linked to forest destruction.

At its launch in 2021, the EU's climate chief Frans Timmermans trumpeted it as "the most ambitious legislation ever put forward to fight forest loss."

A Story of Dilution

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

"By reopening this file instead of solving a technical issue, authorities invited political interference," remarked the Green MEP.

Originally, the regulation required companies to track commodities back to their exact plot of land using GPS coordinates, making them liable for deforestation in their supply chains with criminal charges and large financial penalties.

"It wasn't bureaucracy for its own sake," Schally said. "These rules were the tool that made the rules enforceable, established traceability, and stopped companies from hiding behind complex supply chains."

Intense Lobbying

Yet, the rigorous checks triggered a backlash in the EU capital from multinational corporations, producer countries, conservative political groups and EU logging states.

Experts cite last year's European Parliament elections as a decisive moment, creating a new political majority more skeptical of environmental rules.

"The other pressure came from major export markets like the United States," said corporate sustainability professor, suggesting the EU yielded to some demands in trade talks.

Key Loopholes Introduced

The passed law features several critical weakenings:

• Downstream operators were mostly exempted from submitting due diligence statements.
• A new “low risk” category was introduced.
• A option for more reductions 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," said the law's author. "By shifting responsibilities upstream, it reduced accountability."

Business Frustration

The protracted process and revisions have also caused frustration for companies that prepared in advance.

"We feel very annoyed because we invested significant resources into preparing," stated Xavier Rombouts. "We invested in software, followed seminars and built a team... now they’re saying it may be changed. It’s a major letdown."

Official Defense

An EU representative supported the final law, saying: "The commission has responded to feedback and acted to ensure a pragmatic and balanced application."

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