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Originally hailed as a groundbreaking piece of legislation that would help stop the global scourge of forest loss.

But, the final version of the EU's deforestation regulation, previously touted as the crown jewel of the European Green Deal, has been passed in a significantly diluted state, prompting alarm from its original architect and green lawmakers.

"It has been stripped," said Hugo Schally, pointing to the removal of key obligations for later-stage companies to verify the provenance of products like coffee, cocoa, beef, soy, palm oil, rubber and timber.

Schally cautioned that fewer obligated actors, fewer data points, and imprecise sourcing details would hinder monitoring and legal action.

Political Dismantling

Environmental vice-president a leading green politician went further, describing the postponements, exceptions and new loopholes – such as 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 EU citizens who signed a petition in 2020 calling for a ban on deforestation-linked products.

When launched in 2021, the EU's climate chief Frans Timmermans trumpeted it as "the toughest legislation ever put forward to fight forest loss."

A Story of Dilution

The regulation's dilution is seen by critics as the European Union retreating from its green talk. The proposal encountered significant delays, reportedly over IT issues, which drew condemnation.

"By revisiting the legislation instead of solving a simple IT problem, the commission opened Pandora’s box," commented Toussaint.

Originally, the regulation mandated that firms to track commodities back to their specific geographic origin using geolocation data, holding them accountable for deforestation in their supply chains with criminal charges and large financial penalties.

"This was not red tape for its own sake," Schally explained. "It was the mechanism that ensured enforcement, established traceability, and stopped companies from hiding behind complex supply chains."

Intense Lobbying

However, the rigorous checks provoked opposition 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 more skeptical of environmental rules.

"Additional intense pressure came from major export markets like the United States," noted expert Andreas Rasche, implying the commission gave in to some demands in trade talks.

The Weakened Final Text

In the final legislation includes key dilutions:

• Downstream operators were largely freed from conducting rigorous checks.
• A new “low risk” category was introduced.
• A option for more reductions was established for next spring.
• Only a handful of nations – Russia, Belarus, North Korea and Myanmar – will face the strictest monitoring.

"Rather than strengthening rules for companies, it stripped them back," lamented Schally. "By shifting responsibilities to producers, it reduced accountability."

Uncertainty for Companies

The delays and changes 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 invested in software, followed seminars and built a team... now they’re saying it may be changed. It’s a major letdown."

The Commission's Stance

A commission spokesperson supported the final law, saying: "The commission has responded to concerns and acted to ensure a simple, fair and cost-efficient implementation."

"The revised regulation ensures stability, which is key for business and national regulators to successfully implement this very important law."