EU Deforestation Regulation Largely 'Watered Down' Despite Initial Fanfare

It was a pioneering regulation that would help stop the global crisis of forest loss.

However, the revised version of the EU's anti-deforestation law, once touted as the flagship policy of the European Green Deal, has been passed in a severely weakened state, prompting criticism from its original architect and green lawmakers.

"It has been hollowed out," said Hugo Schally, pointing to the exclusion of key obligations for downstream traders to check the provenance of products like coffee, cocoa, beef, soy, palm oil, rubber and timber.

Schally cautioned that fewer obligated actors, less information collected, and imprecise sourcing details would hinder monitoring and legal action.

A Watered-Down Law

Green party vice-president a leading green politician was more blunt, labeling the delays, loopholes and exemptions – including one for printed products – as the "systematic weakening" of the law.

This outcome stands in stark contrast to the hopes of more than a million EU citizens who signed a petition in 2020 calling for a prohibition of goods linked to forest destruction.

When launched in 2021, the EU's climate chief Frans Timmermans called it "the toughest legislation ever put forward to fight forest loss."

A Story of Dilution

The law's unravelling has been interpreted as the European Union retreating from its green talk. It faced significant delays, reportedly over technical problems, which drew condemnation.

"By revisiting the legislation rather than fixing a simple IT problem, authorities invited political interference," remarked the Green MEP.

In its first draft, the regulation required companies to track commodities back to their specific geographic origin using GPS coordinates, holding them accountable for forest loss along their supply lines with penalties 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 stopped companies from hiding behind opaque production networks."

Intense Lobbying

However, the strict due diligence triggered a backlash in Brussels from large companies, producer countries, rightwing parties and EU logging states.

Analysts point to last year's EU elections as a decisive moment, shifting the balance of power more skeptical of environmental rules.

"Additional intense pressure has come from major export markets like the United States," said expert Andreas Rasche, suggesting the EU yielded to some demands in trade talks.

The Weakened Final Text

In the final legislation features several critical weakenings:

• Downstream operators were largely freed from submitting due diligence statements.
• A new exemption for small operators was introduced.
• A option for more reductions was established for next spring.
• Only a handful of nations – geopolitical adversaries of the EU – will face the strictest monitoring.

"Rather than strengthening downstream obligations, it rolled them back," lamented Schally. "Moving obligations to producers, it reduced accountability."

Uncertainty for Companies

The protracted process and revisions have also created annoyance for companies that prepared in advance.

"We feel very annoyed because we put a lot of effort 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."

Official Defense

A commission spokesperson supported the final law, saying: "The commission has responded to concerns and acted to ensure a pragmatic and balanced implementation."

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