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Originally hailed as a groundbreaking regulation that would curb the global crisis of deforestation.

However, the revised version of the EU's deforestation regulation, previously heralded as the crown jewel of the Green Deal, has emerged in a significantly diluted state, leading to alarm from its initial author and environmental politicians.

"It has been hollowed out," said the law's original author, citing the exclusion of crucial requirements for later-stage companies to verify the origin of products 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 hinder monitoring and legal action.

A Watered-Down Law

Environmental vice-president a leading green politician was more blunt, describing the delays, loopholes and exemptions – such as one for printed products – as the "systematic weakening" of the law.

This final text stands in stark contrast to the hopes of more than a million European citizens who signed a petition in 2020 demanding a ban on deforestation-linked products.

At its launch in 2021, then-Green Deal commissioner the European commissioner trumpeted it as "the toughest law ever put forward to fight forest loss."

From Ambition to Compromise

The law's unravelling is seen by critics as the European Union retreating from its environmental promises. It faced two major postponements, reportedly over technical problems, which sparked criticism.

"By reopening this file instead of solving a technical issue, the commission opened Pandora’s box," remarked the Green MEP.

In its first draft, the law mandated that firms to trace goods to their specific geographic origin using geolocation data, holding them accountable for forest loss along their supply lines with criminal charges and hefty fines.

"It wasn't bureaucracy for its own sake," the former official said. "It was the mechanism that made the rules enforceable, established traceability, and prevented firms from obscuring their activities behind complex supply chains."

Mounting Pressure

However, the rigorous checks provoked opposition in the EU capital from large companies, exporting nations, conservative political groups and EU logging states.

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

"Additional intense pressure came from big trading partners outside the EU," noted expert Andreas Rasche, suggesting the EU yielded to some requests during negotiations.

Key Loopholes Introduced

The passed law features key dilutions:

• Retailers and traders were mostly exempted from submitting due diligence statements.
• A new “low risk” category was created.
• A option for more reductions was established for next spring.
• Only four countries – Russia, Belarus, North Korea and Myanmar – will face the strictest monitoring.

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

Uncertainty for Companies

The delays and changes have also created annoyance for businesses that complied early.

"We feel very annoyed because we put a lot of effort into complying," 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."

The Commission's Stance

An EU representative defended the outcome, stating: "We have listened to concerns and taken action to ensure a pragmatic and balanced application."

"The new text provides for predictability, which is crucial for companies and national regulators to effectively enforce this very important regulation."