🔗 Share this article

Widely celebrated as a groundbreaking regulation that would curb the global scourge of deforestation.

However, the final version of the European Union's deforestation regulation, once heralded as the crown jewel of the European Green Deal, has emerged in a significantly diluted state, leading to alarm from its original architect and green lawmakers.

"The regulation was hollowed out," stated the law's original author, pointing to the exclusion of crucial requirements for downstream traders to verify the provenance of products like coffee, cocoa, beef, soy, palm oil, rubber and timber.

Schally cautioned that a reduced number of responsible companies, fewer data points, and less precise origin data would make enforcement and prosecution more difficult.

Political Dismantling

Environmental vice-president a leading green politician went further, labeling the delays, loopholes and exemptions – including one for paper goods – as the "political dismantling" of the law.

This outcome stands in stark contrast to 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, then-Green Deal commissioner Frans Timmermans trumpeted it as "the most ambitious law proposed to combat 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 reopening this file rather than fixing a simple IT problem, authorities invited political interference," remarked the Green MEP.

Originally, the law required companies to trace goods back 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.

"It wasn't bureaucracy for its own sake," the former official explained. "It was the mechanism that made the rules enforceable, created a verifiable paper trail, and prevented firms from obscuring their activities behind opaque production networks."

Mounting Pressure

Yet, the strict due diligence triggered a backlash 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, creating a new political majority less favorable toward 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 requests during negotiations.

Key Loopholes Introduced

In the final legislation includes several critical weakenings:

• Downstream operators were mostly exempted from conducting rigorous checks.
• A new exemption for small operators was introduced.
• A window for further "simplifications" was opened for next spring.
• Only a handful of nations – geopolitical adversaries of the EU – will face “high risk” scrutiny.

"Instead of tightening downstream obligations, it stripped them back," said the law's author. "By shifting responsibilities upstream, it reduced accountability."

Business Frustration

The delays and changes have also created annoyance for businesses that complied early.

"We feel very annoyed because we invested significant resources into complying," stated Xavier Rombouts. "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

An EU representative supported the final law, saying: "The commission has responded to feedback and taken action to ensure a pragmatic and balanced implementation."

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