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Widely celebrated as a pioneering regulation that would combat the worldwide scourge of forest loss.

However, the final version of the European Union's deforestation regulation, previously heralded as the flagship policy of the European Green Deal, has emerged in a significantly diluted state, leading to criticism from its original architect and environmental politicians.

"It has been stripped," said the law's original author, pointing to the removal of key obligations for later-stage companies to verify the provenance of commodities like coffee, cocoa, beef, soy, palm oil, rubber and timber.

He warned that fewer obligated actors, fewer data points, and imprecise sourcing details would make enforcement and prosecution more difficult.

Political Dismantling

Environmental MEP Marie Toussaint went further, labeling the delays, loopholes and exemptions – including one for paper goods – as the "political dismantling" of the law.

This outcome is a far cry from the hopes of over 1.2 million European citizens who signed a petition in 2020 demanding a prohibition of goods linked to forest destruction.

When launched in 2021, the EU's climate chief the European commissioner called it "the most ambitious legislation proposed to fight forest loss."

From Ambition to Compromise

The regulation's dilution has been interpreted as the European Union retreating from its green talk. The proposal encountered two major postponements, ostensibly over technical problems, which sparked criticism.

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

In its first draft, the regulation mandated that firms to trace commodities back to their specific geographic origin using GPS coordinates, making them liable for deforestation in their supply chains with penalties and hefty fines.

"This was not red tape for its own sake," Schally said. "These rules were the tool that made the rules enforceable, established traceability, and stopped companies from hiding behind opaque production networks."

Intense Lobbying

However, the rigorous checks provoked opposition in the EU capital from large companies, exporting nations, rightwing parties 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 has come from big trading partners outside the EU," said expert Andreas Rasche, implying the commission gave in to some demands in trade talks.

Key Loopholes Introduced

In the final legislation features several critical weakenings:

• Downstream operators were mostly exempted from conducting rigorous checks.
• A new exemption for small operators was introduced.
• A option for more reductions was established for next spring.
• Only four countries – geopolitical adversaries of the EU – will face “high risk” scrutiny.

"Instead of tightening downstream obligations, it stripped them back," said Schally. "Moving obligations to producers, it reduced accountability."

Business Frustration

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

"We feel very annoyed because we invested significant resources into complying," said 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

An EU representative supported the final law, stating: "We have listened to concerns and taken action to ensure a simple, fair and cost-efficient implementation."

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