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It was a pioneering regulation that would curb the global scourge of deforestation.

However, the revised version of the European Union's anti-deforestation law, once touted as the crown jewel of the Green Deal, has emerged in a significantly diluted state, prompting alarm from its original architect and environmental politicians.

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

Schally cautioned that fewer obligated actors, less information collected, and imprecise sourcing details would make enforcement and prosecution more difficult.

Political Dismantling

Environmental vice-president Marie Toussaint was more blunt, labeling the delays, loopholes and exemptions – such as one for printed products – as the "political dismantling" of the law.

This final text stands in stark contrast to the demands of more than a million EU 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 trumpeted it as "the toughest legislation ever put forward to combat forest loss."

A Story of Dilution

The regulation's dilution has been interpreted as the EU walking back its green talk. It faced two major postponements, ostensibly over technical problems, which sparked criticism.

"By reopening this file rather than fixing a technical issue, authorities invited political interference," commented the Green MEP.

In its first draft, the regulation required companies to track goods back to their exact plot of land using geolocation data, making them liable for deforestation in their supply chains with criminal charges and hefty fines.

"It wasn't bureaucracy for its own sake," the former official explained. "It was the mechanism that ensured enforcement, established traceability, and prevented firms from obscuring their activities behind opaque production networks."

Intense Lobbying

Yet, 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, creating a new political majority more skeptical of environmental rules.

"Additional intense pressure came from major export markets like the United States," 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:

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

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

Uncertainty for Companies

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

"We feel very annoyed because we invested significant resources into preparing," said 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 supported the final law, stating: "The commission has responded to feedback and taken action to ensure a simple, fair and cost-efficient application."

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