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It was a landmark regulation that would combat the global crisis of forest loss.

However, the final version of the European Union's deforestation regulation, previously heralded as the crown jewel of the Green Deal, has emerged in a severely weakened state, leading to criticism from its original architect and environmental politicians.

"The regulation was stripped," said the law's original author, citing the exclusion of crucial requirements for later-stage companies 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 imprecise sourcing details would make enforcement and prosecution more difficult.

A Watered-Down Law

Green party MEP a leading green politician was more blunt, labeling the delays, loopholes and exemptions – such as one for paper goods – as the "systematic weakening" of the law.

This outcome 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 trumpeted it as "the most ambitious legislation proposed to fight forest loss."

From Ambition to Compromise

The regulation's dilution is seen by critics as the EU walking back its environmental promises. It faced two major postponements, ostensibly over IT issues, which sparked criticism.

"By reopening this file instead of solving a simple IT problem, authorities invited political interference," remarked the Green MEP.

In its first draft, the law mandated that firms to track commodities back to their exact plot of land using GPS coordinates, holding them accountable for deforestation in their supply chains with criminal charges and hefty fines.

"It wasn't bureaucracy for its own sake," Schally said. "These rules were the tool that made the rules enforceable, created a verifiable paper trail, and prevented firms from obscuring their activities behind opaque production networks."

Mounting Pressure

However, the rigorous checks provoked opposition in the EU capital from multinational corporations, exporting nations, conservative political groups and member states with forestry industries.

Experts cite last year's European Parliament elections as a turning point, shifting the balance of power more skeptical of green regulations.

"Additional intense pressure has come from major export markets 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 includes key dilutions:

• Retailers and traders 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 – geopolitical adversaries of the EU – will face “high risk” scrutiny.

"Instead of tightening downstream obligations, it stripped them back," said 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 companies that prepared in advance.

"It is very frustrating because we put a lot of effort into preparing," said a coffee company executive. "We purchased systems, trained staff and established procedures... now they’re saying it could be altered again. It’s a major letdown."

The Commission's Stance

An EU representative supported the final law, stating: "We have listened to concerns and taken action to ensure a simple, fair and cost-efficient implementation."

"The new text provides for predictability, which is key for business and competent authorities to effectively enforce this very important law."