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It was a groundbreaking law that would curb the global crisis of forest loss.

But, the final version of the EU's deforestation regulation, previously heralded as the crown jewel of the Green Deal, has emerged in a severely weakened state, leading to criticism from its original architect and green lawmakers.

"It has been stripped," said Hugo Schally, citing the removal of key obligations for downstream traders to verify the origin of commodities like coffee, cocoa, beef, soy, palm oil, rubber and timber.

Schally cautioned that fewer obligated actors, fewer data points, and imprecise sourcing details would complicate the task of authorities.

Political Dismantling

Green party vice-president Marie Toussaint was more blunt, describing the postponements, exceptions and new loopholes – such as one for paper goods – as the "systematic weakening" of the law.

This final text is a far cry from the demands of more than a million EU citizens who signed a petition in 2020 calling for a ban on goods linked to forest destruction.

When launched in 2021, the EU's climate chief the European commissioner called it "the toughest law ever put forward to fight forest loss."

From Ambition to Compromise

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

"By revisiting the legislation rather than fixing a simple IT problem, the commission opened Pandora’s box," remarked the Green MEP.

Originally, the law mandated that firms to trace goods back to their exact plot of land using GPS coordinates, making them liable for forest loss along their supply lines with criminal charges 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 prevented firms from obscuring their activities behind complex supply chains."

Intense Lobbying

Yet, the rigorous checks triggered a backlash in Brussels from large companies, producer countries, rightwing parties and member states with forestry industries.

Experts cite last year's EU elections as a decisive moment, creating a new political majority less favorable toward environmental rules.

"The other pressure has come from big trading partners outside the EU," noted expert Andreas Rasche, suggesting the commission gave in to some requests during negotiations.

Key Loopholes Introduced

In the final legislation includes key dilutions:

• Downstream operators were largely freed from submitting due diligence statements.
• A new “low risk” category was created.
• A option for more reductions was opened for next spring.
• Only a handful of nations – Russia, Belarus, North Korea and Myanmar – will face the strictest monitoring.

"Instead of tightening downstream obligations, it stripped them back," lamented the law's author. "Moving obligations upstream, it lessened the number of responsible firms."

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," stated a coffee company executive. "We invested in software, followed seminars and built a team... now they’re saying it could be altered again. It’s a major letdown."

Official Defense

A commission spokesperson defended the outcome, saying: "We have listened to feedback and taken action to ensure a pragmatic and balanced implementation."

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