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

But, the revised version of the European Union's anti-deforestation law, previously touted as the flagship policy of the Green Deal, has emerged in a significantly diluted state, prompting alarm from its initial author and environmental politicians.

"It has been stripped," said Hugo Schally, pointing to the removal of crucial requirements for downstream traders to verify the provenance of products like palm oil, soy, wood, beef, rubber, cocoa and coffee.

Schally cautioned that fewer obligated actors, less information collected, and imprecise sourcing details would hinder monitoring and legal action.

A Watered-Down Law

Green party MEP Marie Toussaint went further, labeling the delays, loopholes and exemptions – including one for paper goods – as the "systematic weakening" of the law.

This outcome is a far cry from the hopes of more than a million European citizens who supported an initiative in 2020 demanding a ban on deforestation-linked products.

At its launch in 2021, then-Green Deal commissioner Frans Timmermans called it "the toughest law proposed to fight forest loss."

From Ambition to Compromise

The regulation's dilution has been interpreted as the European Union retreating from its environmental promises. The proposal encountered two major postponements, reportedly over IT issues, which sparked criticism.

"By revisiting the legislation rather than fixing a technical issue, the commission opened Pandora’s box," commented the Green MEP.

Originally, the law required companies to track goods to their exact plot of land using GPS coordinates, making them liable for forest loss along their supply lines with penalties and large financial penalties.

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

Intense Lobbying

Yet, the strict due diligence triggered a backlash in Brussels from large companies, producer countries, conservative political groups and EU logging states.

Analysts point to last year's EU elections as a decisive moment, shifting the balance of power more skeptical of green regulations.

"Additional intense pressure has come from big trading partners outside the EU," said corporate sustainability professor, suggesting the commission gave in to some demands in trade talks.

Key Loopholes Introduced

The passed law includes several critical weakenings:

• Downstream operators were mostly exempted from submitting due diligence statements.
• A new exemption for small operators was introduced.
• A option for more reductions was opened for next spring.
• Only a handful of nations – geopolitical adversaries of the EU – will face “high risk” scrutiny.

"Rather than strengthening rules for companies, it rolled them back," lamented the law's author. "Moving obligations to producers, it reduced accountability."

Uncertainty for Companies

The protracted process and revisions have also created annoyance for companies that prepared in advance.

"It is very frustrating because we put a lot of effort into preparing," said a coffee company executive. "We purchased systems, trained staff and established procedures... now they’re saying it may be changed. It’s a big frustration."

Official Defense

An EU representative supported the final law, saying: "The commission has responded to feedback and taken action to ensure a simple, fair and cost-efficient application."

"The revised regulation provides for predictability, which is key for business and national regulators to successfully implement this vitally important regulation."