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Originally hailed as a groundbreaking law that would curb the global scourge of forest loss.

But, the final version of the EU's deforestation regulation, previously heralded as the crown jewel of the Green Deal, has been passed in a severely weakened state, leading to alarm from its original architect and environmental politicians.

"It has been hollowed out," said Hugo Schally, citing the exclusion of key obligations for downstream traders to verify the provenance of products like coffee, cocoa, beef, soy, palm oil, rubber and timber.

Schally cautioned that fewer obligated actors, fewer data points, and imprecise sourcing details would hinder monitoring and legal action.

Political Dismantling

Green party vice-president a leading green politician was more blunt, describing the postponements, exceptions and new loopholes – such as one for printed products – as the "political dismantling" of the law.

This outcome stands in stark contrast to the demands of more than a million European citizens who supported an initiative in 2020 demanding a ban on deforestation-linked products.

When launched in 2021, then-Green Deal commissioner Frans Timmermans called it "the most ambitious law ever put forward to combat deforestation."

A Story of Dilution

The law's unravelling is seen by critics as the EU walking back its environmental promises. The proposal encountered significant delays, reportedly over IT issues, which sparked criticism.

"By revisiting the legislation instead of solving a technical issue, the commission opened Pandora’s box," commented the Green MEP.

Originally, the regulation mandated that firms to trace goods back 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.

"It wasn't bureaucracy for its own sake," the former official explained. "These rules were the tool that ensured enforcement, created a verifiable paper trail, and prevented firms from obscuring their activities behind complex supply chains."

Intense Lobbying

However, the strict due diligence triggered a backlash in Brussels from multinational corporations, producer countries, rightwing parties and EU logging states.

Experts cite last year's European Parliament elections as a decisive moment, creating a new political majority more skeptical of environmental rules.

"Additional intense pressure came from major export markets like the United States," said corporate sustainability professor, suggesting the EU yielded to some demands in trade talks.

Key Loopholes Introduced

The passed law includes several critical weakenings:

• Downstream operators were largely freed from submitting due diligence statements.
• A new exemption for small operators was created.
• A option for more reductions 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 Schally. "By shifting responsibilities upstream, it lessened the number of responsible firms."

Business Frustration

The protracted process and revisions have also caused frustration for companies that prepared in advance.

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

The Commission's Stance

A commission spokesperson defended the outcome, saying: "The commission has responded to concerns and taken action to ensure a pragmatic and balanced implementation."

"The new text provides for predictability, which is crucial for companies and competent authorities to successfully implement this vitally important law."