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Originally hailed as a groundbreaking piece of legislation that would help stop the global scourge of forest loss.

But, the final version of the European Union's deforestation regulation, once touted as the flagship policy of the Green Deal, has been passed in a significantly diluted state, prompting criticism from its original architect and environmental politicians.

"It has been hollowed out," stated Hugo Schally, citing the removal 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 fewer obligated actors, less information collected, and imprecise sourcing details would hinder monitoring and legal action.

A Watered-Down Law

Environmental vice-president Marie Toussaint went further, labeling the delays, loopholes and exemptions – including one for paper goods – as the "political dismantling" 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, then-Green Deal commissioner Frans Timmermans called it "the most ambitious legislation ever put forward to combat forest loss."

From Ambition to Compromise

The regulation's dilution has been interpreted as the European Union retreating from its environmental promises. The proposal encountered two major postponements, reportedly over IT issues, which drew condemnation.

"By reopening this file rather than fixing a technical issue, authorities invited political interference," commented Toussaint.

Originally, the law mandated that firms to trace commodities to their exact plot of land using geolocation data, making them liable for forest loss along their supply lines with criminal charges and hefty fines.

"It wasn't bureaucracy for its own sake," the former official explained. "These rules were the tool that ensured enforcement, established traceability, and prevented firms from obscuring their activities behind opaque production networks."

Intense Lobbying

However, the rigorous checks triggered a backlash in the EU capital from large companies, exporting nations, rightwing parties and EU logging states.

Experts cite last year's European Parliament elections as a turning point, creating a new political majority more skeptical of green regulations.

"The other pressure came from major export markets outside the EU," noted expert Andreas Rasche, suggesting the EU yielded to some requests during negotiations.

Key Loopholes Introduced

In the final legislation features key dilutions:

• Downstream operators were mostly exempted from conducting rigorous checks.
• A new exemption for small operators was introduced.
• A window for further "simplifications" was established for next spring.
• Only a handful of nations – geopolitical adversaries of the EU – will face the strictest monitoring.

"Instead of tightening downstream obligations, it rolled them back," lamented Schally. "By shifting responsibilities upstream, it lessened the number of responsible firms."

Business Frustration

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

"It is very frustrating because we put a lot of effort into preparing," stated 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."

Official Defense

An EU representative supported the final law, saying: "The commission has responded to feedback and taken action to ensure a pragmatic and balanced application."

"The revised regulation provides for predictability, which is crucial for companies and national regulators to successfully implement this vitally important regulation."