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Originally hailed as a landmark regulation that would help stop the global scourge of deforestation.

But, the final version of the European Union's deforestation regulation, previously heralded as the flagship policy of the Green Deal, has been passed in a significantly diluted state, leading to alarm from its original architect and environmental politicians.

"The regulation was gutted," stated Hugo Schally, citing the removal of key obligations for downstream traders to check the origin of products like coffee, cocoa, beef, soy, palm oil, rubber and timber.

Schally cautioned that fewer obligated actors, less information collected, and less precise origin data would hinder monitoring and legal action.

A Watered-Down Law

Environmental MEP a leading green politician went further, labeling the postponements, exceptions and new loopholes – such as one for paper goods – as the "systematic weakening" of the law.

This outcome stands in stark contrast to the demands of over 1.2 million European citizens who signed a petition in 2020 calling for a ban on deforestation-linked products.

When launched in 2021, then-Green Deal commissioner Frans Timmermans called it "the toughest legislation proposed to fight deforestation."

A Story of Dilution

The regulation's dilution is seen by critics as the EU walking back its green talk. It faced significant delays, ostensibly over technical problems, which sparked criticism.

"By revisiting the legislation instead of solving a technical issue, authorities invited political interference," commented the Green MEP.

Originally, the law required companies to track commodities back to their specific geographic origin using GPS coordinates, holding them accountable for deforestation in their supply chains with penalties and large financial penalties.

"This was not red tape for its own sake," the former official explained. "These rules were the tool that ensured enforcement, established traceability, and prevented firms from obscuring their activities behind opaque production networks."

Intense Lobbying

However, the strict due diligence provoked opposition in Brussels from large companies, exporting nations, rightwing parties and EU logging states.

Analysts point to last year's EU elections as a turning point, creating a new political majority less favorable toward green regulations.

"Additional intense pressure came from big trading partners outside the EU," noted expert Andreas Rasche, suggesting the EU yielded to some requests during negotiations.

Key Loopholes Introduced

In the final legislation features several critical weakenings:

• Downstream operators were mostly exempted from conducting rigorous checks.
• 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 the strictest monitoring.

"Rather than strengthening rules for companies, it stripped them back," said Schally. "Moving obligations upstream, it lessened the number of responsible firms."

Business Frustration

The protracted process and revisions have also created annoyance 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 invested in software, followed seminars and built a team... now they’re saying it may be changed. It’s a big frustration."

The Commission's Stance

An EU representative defended the outcome, saying: "We have listened to feedback and acted to ensure a simple, fair and cost-efficient implementation."

"The new text ensures stability, which is crucial for companies and national regulators to effectively enforce this vitally important regulation."