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It was a pioneering piece of legislation that would curb the worldwide crisis of deforestation.

But, the revised version of the European Union's deforestation regulation, previously touted as the flagship policy of the Green Deal, has been passed in a significantly diluted state, leading to criticism from its initial author and environmental politicians.

"It has been hollowed out," said Hugo Schally, pointing to the exclusion 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, fewer data points, and imprecise sourcing details would make enforcement and prosecution more difficult.

A Watered-Down Law

Environmental vice-president a leading green politician went further, labeling the delays, loopholes and exemptions – including one for paper goods – as the "political dismantling" of the law.

This final text is a far cry from the demands of more than a million EU citizens who supported an initiative in 2020 demanding a prohibition of goods linked to forest destruction.

At its launch in 2021, the EU's climate chief Frans Timmermans trumpeted it as "the toughest legislation ever put forward to fight forest loss."

A Story of Dilution

The law's unravelling is seen by critics as the EU walking back its environmental promises. It faced two major postponements, ostensibly over technical problems, which drew condemnation.

"By revisiting the legislation instead of solving a technical issue, the commission opened Pandora’s box," remarked Toussaint.

In its first draft, the regulation required companies to trace commodities back to their exact plot of land using geolocation data, holding them accountable for forest loss along their supply lines with criminal charges and hefty fines.

"This was not red tape for its own sake," Schally explained. "These rules were the tool that ensured enforcement, established traceability, and prevented firms from obscuring their activities behind opaque production networks."

Mounting Pressure

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

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

"Additional intense pressure came from big trading partners outside the EU," said corporate sustainability professor, suggesting the EU yielded to some requests during negotiations.

The Weakened Final Text

In the final legislation includes key dilutions:

• Downstream operators were mostly exempted from submitting due diligence statements.
• A new exemption for small operators was created.
• A option for more reductions was opened for next spring.
• Only four countries – Russia, Belarus, North Korea and Myanmar – will face the strictest monitoring.

"Rather than strengthening downstream obligations, it stripped them back," lamented the law's author. "By shifting responsibilities to producers, it reduced accountability."

Business Frustration

The delays and changes have also caused frustration for businesses that complied early.

"It is very frustrating because we put a lot of effort 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."

Official Defense

A commission spokesperson supported the final law, stating: "We have listened to concerns and acted to ensure a pragmatic and balanced application."

"The new text ensures stability, which is crucial for companies and national regulators to effectively enforce this very important law."