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It was a landmark piece of legislation that would help stop the global crisis of forest loss.

But, the revised version of the European Union's anti-deforestation law, once heralded as the flagship policy of the European Green Deal, has emerged in a significantly diluted state, leading to alarm from its initial author and environmental politicians.

"It has been gutted," said the law's original author, pointing to the exclusion of key obligations for downstream traders to verify the origin of products like palm oil, soy, wood, beef, rubber, cocoa and coffee.

Schally cautioned that a reduced number of responsible companies, less information collected, and imprecise sourcing details would hinder monitoring and legal action.

Political Dismantling

Green party vice-president a leading green politician went further, labeling the delays, loopholes and exemptions – including one for printed products – as the "political dismantling" of the law.

This final text is a far cry from the hopes of more than a million European citizens who supported an initiative 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 most ambitious law ever put forward to combat deforestation."

From Ambition to Compromise

The law's unravelling has been interpreted as the European Union retreating from its green talk. The proposal encountered two major postponements, reportedly over technical problems, which sparked criticism.

"By revisiting the legislation rather than fixing a technical issue, authorities invited political interference," remarked the Green MEP.

Originally, the regulation required companies to trace goods back to their specific geographic origin using geolocation data, holding them accountable for deforestation in their supply chains with criminal charges and hefty fines.

"This was not red tape for its own sake," Schally said. "It was the mechanism that ensured enforcement, created a verifiable paper trail, and stopped companies from hiding behind opaque production networks."

Mounting Pressure

However, the strict due diligence triggered a backlash in the EU capital from large companies, producer countries, rightwing parties and member states with forestry industries.

Experts cite last year's EU elections as a decisive moment, 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, implying the commission gave in to some demands in trade talks.

Key Loopholes Introduced

The passed law includes key dilutions:

• Retailers and traders were mostly exempted from submitting due diligence statements.
• A new exemption for small operators was introduced.
• A window for further "simplifications" was opened for next spring.
• Only four countries – Russia, Belarus, North Korea and Myanmar – will face “high risk” scrutiny.

"Rather than strengthening downstream obligations, it rolled them back," lamented the law's author. "By shifting responsibilities upstream, it lessened the number of responsible firms."

Uncertainty for Companies

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

"We feel very annoyed because we put a lot of effort into preparing," said 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 concerns and acted to ensure a pragmatic and balanced application."

"The revised regulation provides for predictability, which is key for business and national regulators to successfully implement this very important regulation."