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Originally hailed as a pioneering law that would combat the global crisis of forest loss.

But, the revised version of the European Union's deforestation regulation, previously touted as the crown jewel of the Green Deal, has emerged in a significantly diluted state, leading to criticism from its initial author and environmental politicians.

"It has been hollowed out," said Hugo Schally, citing the removal of crucial requirements for downstream traders to check 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 make enforcement and prosecution more difficult.

A Watered-Down Law

Green party MEP Marie Toussaint went further, labeling the postponements, exceptions and new loopholes – including one for printed products – as the "systematic weakening" of the law.

This outcome is a far cry from the demands of over 1.2 million EU citizens who signed a petition in 2020 calling for a ban on deforestation-linked products.

When launched in 2021, then-Green Deal commissioner Frans Timmermans called it "the most ambitious law ever put forward to fight deforestation."

A Story of Dilution

The law's unravelling is seen by critics as the EU walking back its green talk. The proposal encountered two major postponements, ostensibly over technical problems, which sparked criticism.

"By reopening this file rather than fixing a simple IT problem, authorities invited political interference," remarked Toussaint.

In its first draft, the law required companies to trace goods back to their exact plot of land using geolocation data, making them liable for forest loss along their supply lines with penalties and large financial penalties.

"It wasn't bureaucracy for its own sake," the former official explained. "It was the mechanism that made the rules enforceable, 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 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," noted corporate sustainability professor, implying the commission gave in to some demands in trade talks.

Key Loopholes Introduced

The passed law includes key dilutions:

• Retailers and traders were largely freed from submitting due diligence statements.
• 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 rolled them back," lamented Schally. "By shifting responsibilities upstream, it lessened the number of responsible firms."

Uncertainty for Companies

The protracted process and revisions have also created annoyance for businesses that complied early.

"We feel very annoyed because we put a lot of effort into preparing," said a coffee company executive. "We purchased systems, trained staff and established procedures... now they’re saying it may be changed. It’s a major letdown."

Official Defense

A commission spokesperson supported the final law, stating: "We have listened to feedback and acted to ensure a simple, fair and cost-efficient implementation."

"The revised regulation provides for predictability, which is key for business and national regulators to effectively enforce this very important law."