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Widely celebrated as a groundbreaking regulation that would help stop the worldwide scourge of forest loss.

But, the revised version of the EU's anti-deforestation law, previously touted as the flagship policy of the European Green Deal, has emerged in a severely weakened state, prompting alarm from its initial author and green lawmakers.

"The regulation was stripped," said the law's original author, citing the removal of crucial requirements for downstream traders to verify the provenance of commodities like palm oil, soy, wood, beef, rubber, cocoa and coffee.

Schally cautioned that a reduced number of responsible companies, fewer data points, and less precise origin data would hinder monitoring and legal action.

A Watered-Down Law

Green party MEP Marie Toussaint was more blunt, labeling the postponements, exceptions and new loopholes – including one for paper goods – as the "systematic weakening" of the law.

This final text stands in stark contrast to the hopes of over 1.2 million European citizens who signed a petition in 2020 demanding a ban on goods linked to forest destruction.

At its launch in 2021, the EU's climate chief the European commissioner called it "the toughest law proposed to fight forest loss."

From Ambition to Compromise

The regulation's dilution has been interpreted as the EU walking back its environmental promises. It faced two major postponements, reportedly over technical problems, which drew condemnation.

"By revisiting the legislation rather than fixing a simple IT problem, the commission opened Pandora’s box," remarked the Green MEP.

In its first draft, the regulation mandated that firms to track goods to their specific geographic origin using geolocation data, making them liable for forest loss along their supply lines with penalties and large financial penalties.

"This was not red tape for its own sake," the former official said. "These rules were the tool that ensured enforcement, established traceability, and prevented firms from obscuring their activities behind complex supply chains."

Mounting Pressure

Yet, the strict due diligence provoked opposition in the EU capital from multinational corporations, exporting nations, rightwing parties and EU logging states.

Analysts point to last year's EU elections as a turning point, shifting the balance of power less favorable toward green regulations.

"The other pressure has come from major export markets outside the EU," said corporate sustainability professor, implying the commission gave in to some requests during negotiations.

Key Loopholes Introduced

The passed law includes key dilutions:

• Downstream operators were largely freed from conducting rigorous checks.
• A new “low risk” category was introduced.
• A window for further "simplifications" was established for next spring.
• Only a handful of nations – Russia, Belarus, North Korea and Myanmar – will face “high risk” scrutiny.

"Instead of tightening downstream obligations, it stripped them back," lamented Schally. "Moving obligations to producers, 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.

"It is very frustrating because we invested significant resources into complying," said 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."

The Commission's Stance

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

"The revised regulation ensures stability, which is crucial for companies and national regulators to effectively enforce this vitally important regulation."