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It was a groundbreaking piece of legislation that would curb the global crisis of deforestation.

But, the revised version of the European Union's anti-deforestation law, once heralded as the flagship policy of the European Green Deal, has been passed in a significantly diluted state, prompting alarm from its initial author and environmental politicians.

"The regulation was gutted," stated Hugo Schally, citing the exclusion of key obligations for later-stage companies to check the origin of commodities 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.

Political Dismantling

Environmental MEP Marie Toussaint went further, describing the delays, loopholes and exemptions – including one for printed products – as the "political dismantling" of the law.

This final text stands in stark contrast to the hopes of more than a million EU citizens who signed a petition in 2020 calling for a prohibition of deforestation-linked products.

At its launch in 2021, the EU's climate chief Frans Timmermans called it "the toughest law proposed to fight deforestation."

From Ambition to Compromise

The law's unravelling is seen by critics as the European Union retreating from its environmental promises. It faced significant delays, ostensibly over IT issues, which drew condemnation.

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

Originally, the regulation mandated that firms to trace commodities back to their exact plot of land using GPS coordinates, holding them accountable for forest loss along their supply lines with penalties and hefty fines.

"It wasn't bureaucracy for its own sake," Schally explained. "It was the mechanism that ensured enforcement, established traceability, and prevented firms from obscuring their activities behind complex supply chains."

Intense Lobbying

However, the strict due diligence triggered a backlash in Brussels from multinational corporations, producer countries, rightwing parties and member states with forestry industries.

Experts cite last year's EU elections as a turning point, creating a new political majority less favorable toward green regulations.

"The other pressure came from big trading partners like the United States," noted expert Andreas Rasche, suggesting the EU yielded to some requests during negotiations.

Key Loopholes Introduced

In the final legislation features several critical weakenings:

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

"Rather than strengthening rules for companies, it stripped them back," said Schally. "Moving obligations upstream, it lessened the number of responsible firms."

Uncertainty for Companies

The protracted process and revisions have also created annoyance for companies that prepared in advance.

"We feel very annoyed because we put a lot of effort into complying," said Xavier Rombouts. "We purchased systems, trained staff and established procedures... now they’re saying it could be altered again. It’s a major letdown."

The Commission's Stance

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

"The revised regulation provides for predictability, which is crucial for companies and competent authorities to effectively enforce this very important regulation."