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Originally hailed as a groundbreaking piece of legislation that would curb the global scourge of forest loss.

But, the revised version of the European Union's deforestation regulation, previously heralded as the flagship policy of the European Green Deal, has been passed in a severely weakened state, prompting criticism from its original architect and environmental politicians.

"The regulation was hollowed out," said the law's original author, pointing to the removal of key obligations for later-stage companies to verify the provenance of products like palm oil, soy, wood, beef, rubber, cocoa and coffee.

Schally cautioned that a reduced number of responsible companies, fewer data points, and imprecise sourcing details would complicate the task of authorities.

Political Dismantling

Environmental vice-president Marie Toussaint went further, describing the delays, loopholes and exemptions – such as one for printed products – as the "systematic weakening" of the law.

This outcome is a far cry from the demands of more than a million European citizens who signed a petition in 2020 demanding a ban on goods linked to forest destruction.

At its launch in 2021, then-Green Deal commissioner Frans Timmermans called it "the toughest law ever put forward to combat forest loss."

A Story of Dilution

The law's unravelling has been interpreted as the EU walking back its green talk. It faced two major postponements, reportedly over IT issues, which drew condemnation.

"By reopening this file instead of solving a simple IT problem, authorities invited political interference," remarked the Green MEP.

In its first draft, the law required companies to trace commodities to their exact plot of land using geolocation data, holding them accountable for forest loss along their supply lines with penalties and large financial penalties.

"This was not red tape for its own sake," Schally explained. "It was the mechanism that ensured enforcement, created a verifiable paper trail, and prevented firms from obscuring their activities behind opaque production networks."

Mounting Pressure

Yet, the strict due diligence triggered a backlash in the EU capital from multinational corporations, producer countries, rightwing parties and EU logging states.

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

"The other pressure came from big trading partners like the United States," said corporate sustainability professor, implying the EU yielded to some requests during negotiations.

The Weakened Final Text

In the final legislation includes key dilutions:

• Retailers and traders were largely freed from conducting rigorous checks.
• A new exemption for small operators was introduced.
• A window for further "simplifications" was opened for next spring.
• Only four countries – geopolitical adversaries of the EU – will face the strictest monitoring.

"Rather than strengthening downstream obligations, it rolled 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 businesses that complied early.

"We feel very annoyed because we invested significant resources into complying," said Xavier Rombouts. "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 competent authorities to successfully implement this very important law."