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It was a pioneering piece of legislation that would curb the worldwide crisis of deforestation.

But, the final version of the European Union's anti-deforestation law, once touted as the flagship policy of the European Green Deal, has emerged in a severely weakened state, prompting criticism from its original architect and environmental politicians.

"It has been hollowed out," said the law's original author, pointing to the exclusion of key obligations for downstream traders to verify the origin of commodities like palm oil, soy, wood, beef, rubber, cocoa and coffee.

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

Environmental MEP a leading green politician was more blunt, labeling the postponements, exceptions and new loopholes – including one for printed products – as the "systematic weakening" of the law.

This final text is a far cry from the demands of more than a million European citizens who signed a petition in 2020 demanding a prohibition of deforestation-linked products.

When launched in 2021, the EU's climate chief Frans Timmermans called it "the most ambitious law proposed to fight deforestation."

A Story of Dilution

The law's unravelling has been interpreted as the EU walking back its environmental promises. It faced two major postponements, reportedly over IT issues, which drew condemnation.

"By revisiting the legislation instead of solving a simple IT problem, the commission opened Pandora’s box," commented Toussaint.

In its first draft, the law required companies to trace commodities back to their specific geographic origin using GPS coordinates, holding them accountable for forest loss along their supply lines with penalties and hefty fines.

"It wasn't bureaucracy for its own sake," Schally said. "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 rigorous checks provoked opposition in the EU capital from multinational corporations, exporting nations, conservative political groups and member states with forestry industries.

Analysts point to last year's EU elections as a decisive moment, creating a new political majority less favorable toward green regulations.

"Additional intense pressure came from major export markets outside the EU," said corporate sustainability professor, suggesting the commission gave in to some requests during negotiations.

Key Loopholes Introduced

The passed law includes key dilutions:

• Retailers and traders were mostly exempted from conducting rigorous checks.
• 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.

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

Business Frustration

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

"We feel very annoyed because we invested significant resources into preparing," stated a coffee company executive. "We purchased systems, trained staff and established procedures... now they’re saying it could be altered again. It’s a big frustration."

The Commission's Stance

An EU representative defended the outcome, saying: "The commission has responded to concerns and taken action to ensure a simple, fair and cost-efficient application."

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