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It was a groundbreaking regulation that would curb the worldwide crisis of forest loss.

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

"It has been hollowed out," said Hugo Schally, citing the removal of crucial requirements for later-stage companies to verify the provenance of commodities like coffee, cocoa, beef, soy, palm oil, rubber and timber.

Schally cautioned that a reduced number of responsible companies, less information collected, and imprecise sourcing details would complicate the task of authorities.

Political Dismantling

Environmental vice-president Marie Toussaint went further, labeling the delays, loopholes and exemptions – including one for printed products – as the "systematic weakening" of the law.

This outcome stands in stark contrast to the hopes of more than a million European citizens who signed a petition in 2020 calling for a ban on goods linked to forest destruction.

At its launch in 2021, then-Green Deal commissioner Frans Timmermans called it "the most ambitious law ever put forward to combat forest loss."

A Story of Dilution

The regulation's dilution is seen by critics as the EU walking back its green talk. The proposal encountered two major postponements, reportedly over technical problems, which drew condemnation.

"By revisiting the legislation rather than fixing a technical issue, the commission opened Pandora’s box," remarked Toussaint.

In its first draft, the regulation mandated that firms to trace goods 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," Schally explained. "It was the mechanism that made the rules enforceable, 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, producer countries, rightwing parties and EU logging states.

Analysts point to last year's European Parliament elections as a turning point, shifting the balance of power more skeptical of environmental rules.

"Additional intense pressure came from big trading partners outside the EU," noted expert Andreas Rasche, suggesting the commission gave in to some demands in trade talks.

Key Loopholes Introduced

In the final legislation features key dilutions:

• Retailers and traders were mostly exempted from conducting rigorous checks.
• A new “low risk” category 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 stripped them back," lamented the law's author. "Moving obligations to producers, it reduced accountability."

Uncertainty for Companies

The delays and changes have also caused frustration for businesses that complied early.

"We feel very annoyed because we invested significant resources 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."

The Commission's Stance

A commission spokesperson supported the final law, stating: "The commission has responded to concerns and acted to ensure a pragmatic and balanced application."

"The revised regulation provides for predictability, which is crucial for companies and competent authorities to successfully implement this very important law."