🔗 Share this article

Originally hailed as a landmark regulation that would curb the worldwide scourge of deforestation.

However, the final version of the EU's deforestation regulation, once heralded as the crown jewel of the Green Deal, has been passed in a severely weakened state, leading to alarm from its initial author and environmental politicians.

"It has been stripped," stated Hugo Schally, pointing to 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 a reduced number of responsible companies, fewer data points, and less precise origin data would complicate the task of authorities.

A Watered-Down Law

Green party vice-president Marie Toussaint was more blunt, labeling the delays, loopholes and exemptions – including one for paper goods – as the "systematic weakening" of the law.

This final text stands in stark contrast to the demands of more than a million European citizens who supported an initiative in 2020 demanding a prohibition of deforestation-linked products.

At its launch in 2021, the EU's climate chief Frans Timmermans trumpeted it as "the most ambitious legislation proposed to combat deforestation."

From Ambition to Compromise

The law's unravelling has been interpreted as the EU walking back its environmental promises. It faced significant delays, ostensibly over IT issues, which drew condemnation.

"By revisiting the legislation instead of solving a technical issue, authorities invited political interference," remarked Toussaint.

In its first draft, the law mandated that firms to track goods 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," Schally said. "These rules were the tool that made the rules enforceable, created a verifiable paper trail, and prevented firms from obscuring their activities behind complex supply chains."

Mounting Pressure

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

Experts cite last year's EU elections as a turning point, shifting the balance of power more skeptical of environmental rules.

"The other pressure has come from big trading partners like the United States," said expert Andreas Rasche, suggesting the commission gave in to some requests during negotiations.

Key Loopholes Introduced

The passed law includes several critical weakenings:

• Downstream operators were largely freed from conducting rigorous checks.
• A new “low risk” category 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.

"Instead of tightening downstream obligations, it stripped them back," lamented the law's author. "Moving obligations upstream, it reduced accountability."

Business Frustration

The delays and changes have also created annoyance for businesses that complied early.

"We feel very annoyed because we invested significant resources 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

A commission spokesperson defended the outcome, stating: "The commission has responded to feedback and taken action to ensure a simple, fair and cost-efficient implementation."

"The new text provides for predictability, which is crucial for companies and competent authorities to successfully implement this vitally important regulation."