🔗 Share this article

Widely celebrated as a landmark regulation that would help stop the worldwide crisis of deforestation.

But, the final version of the EU's deforestation regulation, once heralded as the flagship policy of the Green Deal, has emerged in a severely weakened state, prompting criticism from its initial author and environmental politicians.

"The regulation was hollowed out," said the law's original author, pointing to the exclusion of crucial requirements for downstream traders to verify the origin 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 less precise origin data would make enforcement and prosecution more difficult.

A Watered-Down Law

Green party MEP Marie Toussaint went further, describing the postponements, exceptions and new loopholes – such as one for paper goods – as the "political dismantling" of the law.

This outcome stands in stark contrast to the hopes of over 1.2 million EU citizens who supported an initiative in 2020 demanding a ban on deforestation-linked products.

When launched in 2021, the EU's climate chief the European commissioner trumpeted it as "the toughest law proposed to combat forest loss."

From Ambition to Compromise

The law's unravelling is seen by critics as the European Union retreating from its green talk. The proposal encountered two major postponements, ostensibly over IT issues, which drew condemnation.

"By reopening this file rather than fixing a simple IT problem, the commission opened Pandora’s box," commented Toussaint.

Originally, the regulation mandated that firms to track commodities to their exact plot of land using GPS coordinates, making them liable for deforestation in their supply chains with criminal charges and large financial penalties.

"This was not red tape 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 multinational corporations, producer countries, rightwing parties and member states with forestry industries.

Analysts point to last year's EU elections as a turning point, shifting the balance of power less favorable toward environmental rules.

"The other pressure has come from major export markets outside the EU," noted expert Andreas Rasche, implying the commission gave in to some demands in trade talks.

The Weakened Final Text

The passed law includes key dilutions:

• Retailers and traders were mostly exempted from conducting rigorous checks.
• A new “low risk” category was created.
• A option for more reductions was opened for next spring.
• Only four countries – Russia, Belarus, North Korea and Myanmar – will face the strictest monitoring.

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

Business Frustration

The delays and changes have also created annoyance for companies that prepared in advance.

"It is very frustrating 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 feedback and taken action to ensure a simple, fair and cost-efficient application."

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