🔗 Share this article

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

But, the final 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, prompting criticism from its original architect and environmental politicians.

"The regulation was gutted," stated the law's original author, pointing to the exclusion of crucial requirements for downstream traders to check the provenance of commodities 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 make enforcement and prosecution more difficult.

Political Dismantling

Environmental MEP a leading green politician went further, describing the postponements, exceptions and new loopholes – such as one for paper goods – as the "systematic weakening" of the law.

This outcome stands in stark contrast to the demands of over 1.2 million European citizens who signed a petition in 2020 calling for a ban on deforestation-linked products.

At its launch 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 has been interpreted as the European Union retreating from its green talk. It faced two major postponements, reportedly over IT issues, which sparked criticism.

"By reopening this file instead of solving a simple IT problem, authorities invited political interference," commented Toussaint.

Originally, the law required companies to track commodities back to their exact plot of land using GPS coordinates, making them liable for deforestation in their supply chains with penalties and hefty fines.

"It wasn't bureaucracy for its own sake," the former official said. "It was the mechanism that ensured enforcement, created a verifiable paper trail, and prevented firms from obscuring their activities behind opaque production networks."

Mounting Pressure

Yet, the rigorous checks triggered a backlash in Brussels from multinational corporations, exporting nations, conservative political groups and member states with forestry industries.

Experts cite last year's EU elections as a decisive moment, creating a new political majority more skeptical of green regulations.

"Additional intense pressure came from major export markets like the United States," said expert Andreas Rasche, suggesting the EU yielded to some requests during negotiations.

Key Loopholes Introduced

In the final legislation includes 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 a handful of nations – Russia, Belarus, North Korea and Myanmar – will face “high risk” scrutiny.

"Rather than strengthening rules for companies, it rolled them back," lamented Schally. "By shifting responsibilities upstream, it lessened the number of responsible firms."

Uncertainty for Companies

The protracted process and revisions have also created annoyance for businesses that complied early.

"It is very frustrating because we put a lot of effort into preparing," said a coffee company executive. "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

An EU representative defended the outcome, stating: "The commission has responded to concerns and taken action to ensure a pragmatic and balanced application."

"The new text ensures stability, which is key for business and competent authorities to effectively enforce this vitally important law."