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It was a pioneering piece of legislation that would combat the global crisis of forest loss.

But, the revised version of the EU's anti-deforestation law, previously heralded as the crown jewel of the European Green Deal, has been passed in a severely weakened state, leading to alarm from its initial author and green lawmakers.

"It has been stripped," said Hugo Schally, pointing to the exclusion of key obligations for later-stage companies to verify the origin of products like palm oil, soy, wood, beef, rubber, cocoa and coffee.

Schally cautioned that fewer obligated actors, less information collected, and imprecise sourcing details would make enforcement and prosecution more difficult.

Political Dismantling

Environmental vice-president a leading green politician was more blunt, 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 European citizens who signed a petition in 2020 demanding a ban on deforestation-linked products.

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

A Story of Dilution

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

"By reopening this file instead of solving a simple IT problem, the commission opened Pandora’s box," remarked Toussaint.

Originally, the law mandated that firms to track commodities to their exact plot of land using geolocation data, holding them accountable for forest loss along their supply lines with penalties and hefty fines.

"This was not red tape for its own sake," Schally said. "These rules were the tool that ensured enforcement, established traceability, 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, exporting nations, rightwing parties and EU logging states.

Experts cite last year's European Parliament elections as a turning point, shifting the balance of power more skeptical of environmental rules.

"Additional intense pressure came from major export markets like the United States," noted expert Andreas Rasche, suggesting the commission gave in to some demands in trade talks.

Key Loopholes Introduced

The passed law includes key dilutions:

• Downstream operators were largely freed from submitting due diligence statements.
• A new exemption for small operators was created.
• A option for more reductions was opened for next spring.
• Only a handful of nations – Russia, Belarus, North Korea and Myanmar – will face “high risk” scrutiny.

"Instead of tightening downstream obligations, it rolled them back," said Schally. "Moving obligations to producers, it reduced accountability."

Uncertainty for Companies

The protracted process and revisions have also created annoyance for companies that prepared in advance.

"It is very frustrating because we invested significant resources into preparing," stated a coffee company executive. "We purchased systems, trained staff and established procedures... now they’re saying it could be altered again. It’s a major letdown."

Official Defense

A commission spokesperson defended the outcome, saying: "The commission has responded to feedback and taken action to ensure a simple, fair and cost-efficient implementation."

"The new text provides for predictability, which is key for business and competent authorities to successfully implement this very important regulation."