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Originally hailed as a pioneering regulation that would help stop the global crisis of deforestation.

However, the final version of the European Union's deforestation regulation, once heralded as the flagship policy of the Green Deal, has been passed in a significantly diluted state, prompting alarm from its initial author and green lawmakers.

"It has been stripped," said the law's original author, citing the removal of key obligations for later-stage companies to check the origin of commodities like coffee, cocoa, beef, soy, palm oil, rubber and timber.

Schally cautioned that a reduced number of responsible companies, fewer data points, and less precise origin data would hinder monitoring and legal action.

A Watered-Down Law

Green party MEP a leading green politician went further, describing the postponements, exceptions and new loopholes – including one for paper goods – as the "political dismantling" of the law.

This outcome is a far cry from the demands of over 1.2 million EU citizens who supported an initiative in 2020 demanding a prohibition of goods linked to forest destruction.

At its launch in 2021, then-Green Deal commissioner Frans Timmermans called it "the toughest legislation proposed to combat deforestation."

From Ambition to Compromise

The law's unravelling is seen by critics as the EU walking back its green talk. It faced two major postponements, ostensibly over IT issues, which sparked criticism.

"By reopening this file rather than fixing a simple IT problem, authorities invited political interference," commented Toussaint.

Originally, the law mandated that firms to track goods to their specific geographic origin using GPS coordinates, making them liable for deforestation in their supply chains with criminal charges and hefty fines.

"This was not red tape for its own sake," the former official explained. "These rules were the tool that made the rules enforceable, established traceability, and prevented firms from obscuring their activities behind complex supply chains."

Mounting Pressure

Yet, the rigorous checks provoked opposition in Brussels from multinational corporations, exporting nations, conservative political groups and member states with forestry industries.

Analysts point to last year's European Parliament elections as a decisive moment, creating a new political majority more skeptical of green regulations.

"The other pressure has come from major export markets outside the EU," noted expert Andreas Rasche, implying the commission gave in to some requests during negotiations.

The Weakened Final Text

The passed law includes key dilutions:

• Retailers and traders were mostly exempted from conducting rigorous checks.
• A new exemption for small operators was created.
• A window for further "simplifications" was established for next spring.
• Only four countries – geopolitical adversaries of the EU – will face “high risk” scrutiny.

"Rather than strengthening rules for companies, it stripped them back," lamented Schally. "Moving obligations upstream, it reduced accountability."

Uncertainty for Companies

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

"We feel very annoyed because we invested significant resources into complying," 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."

Official Defense

An EU representative supported the final law, saying: "We have listened to concerns and taken action to ensure a simple, fair and cost-efficient application."

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