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Widely celebrated as a groundbreaking regulation that would help stop the worldwide crisis of deforestation.

But, the final version of the European Union's anti-deforestation law, previously touted as the crown jewel of the European Green Deal, has emerged in a significantly diluted state, prompting criticism from its initial author and green lawmakers.

"It has been gutted," said 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 complicate the task of authorities.

Political Dismantling

Environmental 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 demands of over 1.2 million EU citizens who signed a petition in 2020 calling for a ban on goods linked to forest destruction.

When launched in 2021, then-Green Deal commissioner the European commissioner trumpeted it as "the most ambitious law ever put forward to fight forest loss."

A Story of Dilution

The law's unravelling is seen by critics as the European Union retreating from its environmental promises. The proposal encountered two major postponements, reportedly over IT issues, which sparked criticism.

"By revisiting the legislation instead of solving a simple IT problem, authorities invited political interference," commented the Green MEP.

Originally, the regulation mandated that firms to trace commodities back to their specific geographic origin using GPS coordinates, holding them accountable for forest loss along their supply lines with criminal charges and large financial penalties.

"This was not red tape for its own sake," the former official said. "It was the mechanism that made the rules enforceable, created a verifiable paper trail, and stopped companies from hiding behind complex supply chains."

Mounting Pressure

However, the rigorous checks triggered a backlash in the EU capital from large companies, producer countries, conservative political groups and member states with forestry industries.

Experts cite last year's EU elections as a decisive moment, shifting the balance of power more skeptical of green regulations.

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

The Weakened Final Text

The passed law features several critical weakenings:

• Retailers and traders were mostly exempted from submitting due diligence statements.
• A new “low risk” category was introduced.
• A window for further "simplifications" was opened for next spring.
• Only a handful of nations – geopolitical adversaries of the EU – will face the strictest monitoring.

"Instead of tightening downstream obligations, it rolled them back," lamented Schally. "Moving obligations upstream, it reduced accountability."

Business Frustration

The delays and changes have also caused frustration for companies that prepared in advance.

"It is very frustrating because we put a lot of effort into preparing," stated 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 feedback and acted to ensure a pragmatic and balanced implementation."

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