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It was a pioneering piece of legislation that would combat the global scourge of forest loss.

However, the revised version of the EU's anti-deforestation law, once touted as the crown jewel of the European Green Deal, has been passed in a significantly diluted state, leading to alarm from its initial author and environmental politicians.

"It has been gutted," stated Hugo Schally, pointing to the exclusion of crucial requirements for downstream traders 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 MEP a leading green politician went further, describing the delays, loopholes and exemptions – including one for paper goods – as the "systematic weakening" of the law.

This final text is a far cry from the demands of over 1.2 million European citizens who signed a petition in 2020 demanding a prohibition of deforestation-linked products.

At its launch in 2021, the EU's climate chief the European commissioner trumpeted it as "the most ambitious legislation ever put forward to combat forest loss."

From Ambition to Compromise

The law's unravelling has been interpreted as the European Union retreating from its green talk. The proposal encountered significant delays, ostensibly over technical problems, which drew condemnation.

"By revisiting the legislation rather than fixing a simple IT problem, authorities invited political interference," remarked the Green MEP.

In its first draft, the regulation required companies to trace commodities to their exact plot of land using geolocation data, holding them accountable for deforestation in their supply chains with penalties and large financial penalties.

"It wasn't bureaucracy for its own sake," Schally said. "These rules were the tool that ensured enforcement, created a verifiable paper trail, and stopped companies from hiding behind opaque production networks."

Intense Lobbying

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

Analysts point to last year's EU elections as a decisive moment, creating a new political majority less favorable toward green regulations.

"Additional intense pressure has come from major export markets like the United States," said expert Andreas Rasche, implying the commission gave in to some requests during negotiations.

Key Loopholes Introduced

In the final legislation includes several critical weakenings:

• Retailers and traders were mostly exempted from submitting due diligence statements.
• A new “low risk” category was created.
• A window for further "simplifications" was established for next spring.
• Only a handful of nations – geopolitical adversaries of the EU – will face the strictest monitoring.

"Instead of tightening downstream obligations, 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 companies that prepared in advance.

"We feel very annoyed because we put a lot of effort into preparing," stated a coffee company executive. "We purchased systems, trained staff and established procedures... now they’re saying it could be altered again. It’s a big frustration."

Official Defense

A commission spokesperson defended the outcome, stating: "The commission has responded to concerns and acted to ensure a simple, fair and cost-efficient application."

"The revised regulation provides for predictability, which is crucial for companies and national regulators to effectively enforce this vitally important law."