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Widely celebrated as a landmark regulation that would help stop the global scourge of deforestation.

However, the final version of the European Union's anti-deforestation law, once touted as the crown jewel of the Green Deal, has emerged in a severely weakened state, prompting alarm from its initial author and environmental politicians.

"It has been hollowed out," stated Hugo Schally, citing the removal of key obligations for downstream traders to check the provenance of commodities like coffee, cocoa, beef, soy, palm oil, rubber and timber.

He warned that fewer obligated actors, less information collected, and imprecise sourcing details would complicate the task of authorities.

A Watered-Down Law

Green party MEP Marie Toussaint was more blunt, labeling the delays, loopholes and exemptions – such as one for paper goods – 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 supported an initiative in 2020 demanding a prohibition of deforestation-linked products.

When launched in 2021, the EU's climate chief Frans Timmermans trumpeted it as "the most ambitious 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 green talk. It faced significant delays, reportedly over IT issues, which sparked criticism.

"By revisiting the legislation instead of solving a simple IT problem, the commission opened Pandora’s box," remarked Toussaint.

Originally, the regulation required companies to track commodities back to their exact plot of land using GPS coordinates, holding them accountable for deforestation in their supply chains with penalties and large financial penalties.

"It wasn't bureaucracy for its own sake," Schally explained. "It was the mechanism that made the rules enforceable, established traceability, and prevented firms from obscuring their activities behind opaque production networks."

Intense Lobbying

However, the strict due diligence provoked opposition in Brussels from multinational corporations, exporting nations, rightwing parties and EU logging states.

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

"Additional intense pressure came from big trading partners like the United States," said expert Andreas Rasche, suggesting the commission gave in to some demands in trade talks.

Key Loopholes Introduced

The passed law features several critical weakenings:

• Retailers and traders were largely freed from submitting due diligence statements.
• A new exemption for small operators was created.
• A option for more reductions 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," said the law's author. "Moving obligations to producers, it reduced accountability."

Uncertainty for Companies

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

"It is very frustrating because we invested significant resources into complying," said 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

An EU representative defended the outcome, saying: "We have listened to concerns and acted to ensure a pragmatic and balanced implementation."

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