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It was a groundbreaking regulation that would combat the global crisis of deforestation.

But, the final version of the EU's deforestation regulation, previously heralded 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.

"The regulation was gutted," stated Hugo Schally, citing the exclusion of crucial requirements for later-stage companies to verify the provenance 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 complicate the task of authorities.

Political Dismantling

Green party vice-president Marie Toussaint was more blunt, describing the delays, loopholes and exemptions – such as one for printed products – 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 signed a petition in 2020 calling for a prohibition of deforestation-linked products.

At its launch in 2021, then-Green Deal commissioner the European commissioner trumpeted it as "the most ambitious legislation ever put forward to fight forest loss."

From Ambition to Compromise

The law's unravelling has been interpreted as the European Union retreating from its environmental promises. It faced significant delays, ostensibly over technical problems, which drew condemnation.

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

Originally, the regulation required companies to trace goods to their exact plot of land using geolocation data, holding them accountable 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 said. "It was the mechanism that made the rules enforceable, created a verifiable paper trail, and prevented firms from obscuring their activities behind opaque production networks."

Intense Lobbying

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

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

"The other pressure has come from big trading partners outside the EU," noted corporate sustainability professor, suggesting the EU yielded to some demands in trade talks.

The Weakened Final Text

The passed law features key dilutions:

• Retailers and traders were mostly exempted from conducting rigorous checks.
• A new “low risk” category was created.
• A window for further "simplifications" was established for next spring.
• Only four countries – geopolitical adversaries of the EU – will face the strictest monitoring.

"Instead of tightening downstream obligations, it stripped them back," said Schally. "By shifting responsibilities upstream, it reduced accountability."

Business Frustration

The protracted process and revisions have also created annoyance for businesses that complied early.

"We feel very annoyed because we put a lot of effort into preparing," said Xavier Rombouts. "We purchased systems, trained staff and established procedures... now they’re saying it may be changed. It’s a big frustration."

The Commission's Stance

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

"The revised regulation ensures stability, which is key for business and competent authorities to effectively enforce this vitally important regulation."