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Widely celebrated as a pioneering regulation that would curb the global scourge of deforestation.

But, the revised version of the European Union's deforestation regulation, once touted as the flagship policy of the European Green Deal, has emerged in a severely weakened state, prompting criticism from its original architect and environmental politicians.

"The regulation was stripped," said Hugo Schally, pointing to the exclusion of key obligations for downstream traders to verify the provenance of commodities like palm oil, soy, wood, beef, rubber, cocoa and coffee.

Schally cautioned that fewer obligated actors, fewer data points, and less precise origin data would make enforcement and prosecution more difficult.

Political Dismantling

Green party vice-president Marie Toussaint went further, describing the delays, loopholes and exemptions – such as one for printed products – as the "systematic weakening" of the law.

This outcome is a far cry from the hopes of over 1.2 million European 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 called it "the most ambitious law proposed to fight forest loss."

From Ambition to Compromise

The law's unravelling 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 instead of solving a simple IT problem, authorities invited political interference," remarked the Green MEP.

Originally, the law 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 large financial penalties.

"This was not red tape for its own sake," Schally explained. "It was the mechanism that made the rules enforceable, created a verifiable paper trail, and stopped companies from hiding behind opaque production networks."

Intense Lobbying

However, the strict due diligence triggered a backlash in the EU capital from large companies, producer countries, rightwing parties and member states with forestry industries.

Analysts point to last year's European Parliament elections as a turning point, shifting the balance of power more skeptical of environmental rules.

"The other pressure came from big trading partners outside the EU," said corporate sustainability professor, implying the commission gave in to some demands in trade talks.

The Weakened Final Text

In the final legislation includes several critical weakenings:

• Downstream operators were mostly exempted from submitting due diligence statements.
• A new exemption for small operators was created.
• A window for further "simplifications" 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," said the law's author. "By shifting responsibilities upstream, it lessened the number of responsible firms."

Business Frustration

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

"It is very frustrating because we put a lot of effort into complying," stated a coffee company executive. "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

A commission spokesperson defended the outcome, saying: "The commission has responded to feedback and acted to ensure a pragmatic and balanced application."

"The new text provides for predictability, which is crucial for companies and national regulators to successfully implement this vitally important law."