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It was a groundbreaking piece of legislation that would combat the worldwide scourge of forest loss.

But, the final version of the EU's deforestation regulation, once touted as the crown jewel of the European Green Deal, has been passed in a significantly diluted state, prompting criticism from its initial author and environmental politicians.

"It has been gutted," stated Hugo Schally, citing the removal of key obligations for downstream traders to verify the provenance of commodities like palm oil, soy, wood, beef, rubber, cocoa and coffee.

He warned that fewer obligated actors, less information collected, and imprecise sourcing details would complicate the task of authorities.

A Watered-Down Law

Environmental vice-president a leading green politician was more blunt, labeling the delays, loopholes and exemptions – including one for printed products – as the "political dismantling" of the law.

This outcome stands in stark contrast to the demands of over 1.2 million EU citizens who supported an initiative in 2020 calling for a ban on deforestation-linked products.

When launched in 2021, then-Green Deal commissioner the European commissioner trumpeted it as "the toughest legislation proposed to combat deforestation."

A Story of Dilution

The regulation's dilution is seen by critics as the EU walking back its green talk. The proposal encountered two major postponements, ostensibly over technical problems, which drew condemnation.

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

Originally, the regulation required companies to trace goods to their specific geographic origin using GPS coordinates, making them liable for deforestation in their supply chains with penalties and hefty fines.

"This was not red tape for its own sake," Schally explained. "It was the mechanism that made the rules enforceable, established traceability, and prevented firms from obscuring their activities behind complex supply chains."

Mounting Pressure

However, the strict due diligence provoked opposition in the EU capital from multinational corporations, producer countries, conservative political groups and EU logging states.

Experts cite last year's EU elections as a decisive moment, shifting the balance of power less favorable toward green regulations.

"The other pressure came from major export markets like the United States," noted corporate sustainability professor, implying the commission gave in to some requests during negotiations.

Key Loopholes Introduced

In the final legislation features several critical weakenings:

• Downstream operators were mostly exempted from submitting due diligence statements.
• A new “low risk” category was introduced.
• A window for further "simplifications" was established for next spring.
• Only four countries – Russia, Belarus, North Korea and Myanmar – will face the strictest monitoring.

"Rather than strengthening downstream obligations, it rolled them back," said the law's author. "Moving obligations upstream, 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 put a lot of effort into preparing," said a coffee company executive. "We invested in software, followed seminars and built a team... now they’re saying it could be altered again. It’s a big frustration."

Official Defense

A commission spokesperson defended the outcome, stating: "We have listened to concerns and taken action to ensure a pragmatic and balanced implementation."

"The new text provides for predictability, which is key for business and national regulators to successfully implement this very important law."