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Widely celebrated as a pioneering piece of legislation that would combat the global crisis of forest loss.

But, the final version of the European Union's deforestation regulation, previously touted as the flagship policy of the Green Deal, has been passed in a significantly diluted state, leading to criticism from its original architect and green lawmakers.

"The regulation was hollowed out," stated Hugo Schally, citing the removal of key obligations for later-stage companies to verify the provenance of products like coffee, cocoa, beef, soy, palm oil, rubber and timber.

He warned that a reduced number of responsible companies, less information collected, and less precise origin data would complicate the task of authorities.

A Watered-Down Law

Environmental MEP Marie Toussaint went further, labeling the postponements, exceptions and new loopholes – such as one for printed products – as the "systematic weakening" of the law.

This final text is a far cry from the demands of over 1.2 million European citizens who supported an initiative in 2020 demanding a ban on deforestation-linked products.

When launched in 2021, then-Green Deal commissioner the European commissioner trumpeted it as "the toughest legislation proposed to fight forest loss."

A Story of Dilution

The regulation's dilution is seen by critics as the European Union retreating from its environmental promises. The proposal encountered two major postponements, ostensibly over IT issues, which drew condemnation.

"By reopening this file instead of solving a technical issue, the commission opened Pandora’s box," remarked Toussaint.

In its first draft, the regulation mandated that firms to track goods to their specific geographic origin using geolocation data, making them liable for forest loss along their supply lines with criminal charges and hefty fines.

"This was not red tape for its own sake," Schally 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."

Intense Lobbying

However, the rigorous checks provoked opposition in Brussels from large companies, producer countries, conservative political groups and EU logging states.

Analysts point to last year's EU elections as a turning point, creating a new political majority more skeptical of environmental rules.

"Additional intense pressure has come from major export markets like the United States," said expert Andreas Rasche, suggesting the commission gave in to some requests during negotiations.

The Weakened Final Text

In the final legislation features several critical weakenings:

• Downstream operators were largely freed from submitting due diligence statements.
• A new “low risk” category was introduced.
• A window for further "simplifications" was established for next spring.
• Only a handful of nations – Russia, Belarus, North Korea and Myanmar – will face the strictest monitoring.

"Instead of tightening rules for companies, it rolled them back," lamented Schally. "By shifting responsibilities to producers, it reduced accountability."

Uncertainty for Companies

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

"It is very frustrating 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 may be changed. It’s a major letdown."

The Commission's Stance

A commission spokesperson defended the outcome, stating: "We have listened to concerns and acted to ensure a pragmatic and balanced application."

"The new text provides for predictability, which is crucial for companies and national regulators to successfully implement this very important law."