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

However, the final version of the European Union's anti-deforestation law, previously heralded as the flagship policy of the European Green Deal, has emerged in a significantly diluted state, prompting criticism from its original architect and environmental politicians.

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

He warned that a reduced number of responsible companies, fewer data points, and imprecise sourcing details would complicate the task of authorities.

A Watered-Down Law

Green party MEP a leading green politician was more blunt, labeling the postponements, exceptions and new loopholes – such as one for paper goods – as the "political dismantling" of the law.

This final text stands in stark contrast to the hopes of more than a million European citizens who supported an initiative in 2020 calling for a ban on goods linked to forest destruction.

When launched in 2021, then-Green Deal commissioner the European commissioner called it "the toughest law proposed to fight forest loss."

From Ambition to Compromise

The law's unravelling is seen by critics as the European Union retreating from its green talk. It faced significant delays, reportedly over technical problems, which sparked criticism.

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

Originally, the regulation required companies to trace commodities to their exact plot of land using GPS coordinates, making them liable for forest loss along their supply lines with penalties and large financial penalties.

"This was not red tape for its own sake," Schally said. "It was the mechanism that made the rules enforceable, created a verifiable paper trail, and stopped companies from hiding behind complex supply chains."

Intense Lobbying

However, the strict due diligence provoked opposition in the EU capital from large companies, producer countries, conservative political groups and member states with forestry industries.

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

"Additional intense pressure came from big trading partners like the United States," said expert Andreas Rasche, suggesting the EU yielded to some requests during negotiations.

Key Loopholes Introduced

The passed law features several critical weakenings:

• Retailers and traders were largely freed from conducting rigorous checks.
• A new “low risk” category was created.
• A option for more reductions was established for next spring.
• Only a handful of nations – Russia, Belarus, North Korea and Myanmar – will face “high risk” scrutiny.

"Instead of tightening rules for companies, it stripped them back," said the law's author. "By shifting responsibilities to producers, it reduced accountability."

Uncertainty for Companies

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 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 taken action to ensure a simple, fair and cost-efficient implementation."

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