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It was a landmark law that would combat the worldwide crisis of forest loss.

But, the final version of the EU's anti-deforestation law, once heralded as the flagship policy of the Green Deal, has emerged in a significantly diluted state, prompting alarm from its initial author and green lawmakers.

"The regulation was stripped," said the law's original author, pointing to the exclusion of crucial requirements for later-stage companies to verify the origin of products like coffee, cocoa, beef, soy, palm oil, rubber and timber.

Schally cautioned that a reduced number of responsible companies, less information collected, and less precise origin data would make enforcement and prosecution more difficult.

A Watered-Down Law

Green party MEP Marie Toussaint went further, 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 over 1.2 million European citizens who supported an initiative in 2020 demanding a prohibition of deforestation-linked products.

When launched in 2021, the EU's climate chief the European commissioner trumpeted it as "the most ambitious law ever put forward to fight deforestation."

From Ambition to Compromise

The law's unravelling is seen by critics as the European Union retreating from its environmental promises. The proposal encountered significant delays, ostensibly over technical problems, which drew condemnation.

"By revisiting the legislation instead of solving a simple IT problem, authorities invited political interference," commented Toussaint.

Originally, the regulation required companies to trace goods to their exact plot of land using GPS coordinates, making them liable for deforestation in their supply chains with criminal charges and large financial penalties.

"This was not red tape for its own sake," the former official explained. "These rules were the tool that ensured enforcement, created a verifiable paper trail, and stopped companies from hiding behind complex supply chains."

Mounting Pressure

Yet, the strict due diligence provoked opposition in the EU capital from large companies, exporting nations, conservative political groups and EU logging states.

Experts cite last year's EU elections as a turning point, creating a new political majority less favorable toward green regulations.

"Additional intense pressure came from major export markets like the United States," noted expert Andreas Rasche, suggesting the EU yielded to some requests during negotiations.

Key Loopholes Introduced

The passed law features several critical weakenings:

• Retailers and traders were mostly exempted from submitting due diligence statements.
• A new exemption for small operators was created.
• A window for further "simplifications" was opened for next spring.
• Only four countries – Russia, Belarus, North Korea and Myanmar – will face the strictest monitoring.

"Instead of tightening downstream obligations, it rolled them back," said the law's author. "Moving obligations to producers, it reduced accountability."

Uncertainty for Companies

The protracted process and revisions have also caused frustration for businesses that complied early.

"It is very frustrating because we put a lot of effort into complying," stated Xavier Rombouts. "We invested in software, followed seminars and built a team... now they’re saying it may be changed. It’s a big frustration."

The Commission's Stance

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

"The new text provides for predictability, which is key for business and national regulators to effectively enforce this vitally important law."