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It was a pioneering piece of legislation that would curb the worldwide scourge of forest loss.

However, the final version of the EU's deforestation regulation, previously heralded as the crown jewel of the Green Deal, has been passed in a significantly diluted state, leading to criticism from its initial author and green lawmakers.

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

He warned that fewer obligated actors, fewer data points, and imprecise sourcing details would make enforcement and prosecution more difficult.

A Watered-Down Law

Environmental vice-president Marie Toussaint was more blunt, labeling the delays, loopholes and exemptions – such as one for printed products – as the "systematic weakening" of the law.

This outcome stands in stark contrast to the demands of more than a million EU citizens who signed a petition in 2020 demanding a ban on goods linked to forest destruction.

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

A Story of Dilution

The regulation's dilution has been interpreted as the EU walking back its green talk. The proposal encountered two major postponements, reportedly over technical problems, which drew condemnation.

"By reopening this file rather than fixing a technical issue, authorities invited political interference," remarked Toussaint.

In its first draft, the regulation required companies to track commodities to their specific geographic origin using geolocation data, holding them accountable for forest loss along their supply lines with penalties and large financial penalties.

"It wasn't bureaucracy for its own sake," the former official said. "These rules were the tool that ensured enforcement, established traceability, and prevented firms from obscuring their activities behind complex supply chains."

Mounting Pressure

Yet, the rigorous checks provoked opposition in the EU capital from multinational corporations, producer countries, conservative political groups and EU logging states.

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

"The other pressure has come from big trading partners like the United States," said corporate sustainability professor, suggesting the commission gave in to some demands in trade talks.

The Weakened Final Text

In the final legislation features 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 the strictest monitoring.

"Instead of tightening downstream obligations, it stripped them back," lamented the law's author. "Moving obligations to producers, it lessened the number of responsible firms."

Business Frustration

The protracted process and revisions have also caused frustration for businesses that complied early.

"We feel very annoyed because we put a lot of effort into complying," stated Xavier Rombouts. "We invested in software, followed seminars and built a team... now they’re saying it could be altered again. It’s a big frustration."

Official Defense

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

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