🔗 Share this article

It was a landmark law that would help stop the global scourge of forest loss.

However, the revised version of the European Union's deforestation regulation, previously heralded as the crown jewel of the European Green Deal, has been passed in a severely weakened state, leading to criticism from its initial author and environmental politicians.

"It has been stripped," stated Hugo Schally, citing the exclusion of crucial requirements for later-stage companies to verify the provenance of products like palm oil, soy, wood, beef, rubber, cocoa and coffee.

Schally cautioned that fewer obligated actors, less information collected, and less precise origin data would hinder monitoring and legal action.

A Watered-Down Law

Green party vice-president Marie Toussaint was more blunt, labeling the delays, loopholes and exemptions – including one for printed products – 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 signed a petition in 2020 demanding a ban on deforestation-linked products.

At its launch in 2021, the EU's climate chief the European commissioner called it "the most ambitious legislation ever put forward to fight deforestation."

From Ambition to Compromise

The law's unravelling is seen by critics as the EU walking back its environmental promises. The proposal encountered significant delays, ostensibly over technical problems, which drew condemnation.

"By reopening this file rather than fixing a technical issue, the commission opened Pandora’s box," remarked Toussaint.

In its first draft, the regulation 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 penalties and large financial penalties.

"This was not red tape for its own sake," Schally said. "It was the mechanism that ensured enforcement, created a verifiable paper trail, 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, producer countries, rightwing parties and member states with forestry industries.

Analysts point to last year's European Parliament elections as a decisive moment, creating a new political majority less favorable toward environmental rules.

"The other pressure came from big trading partners outside the EU," noted 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 mostly exempted from conducting rigorous checks.
• A new “low risk” category was introduced.
• A option for more reductions was established for next spring.
• Only a handful of nations – geopolitical adversaries of the EU – will face “high risk” scrutiny.

"Rather than strengthening downstream obligations, it stripped them back," said Schally. "By shifting responsibilities upstream, it lessened the number of responsible firms."

Uncertainty for Companies

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

"It is very frustrating because we invested significant resources into complying," stated a coffee company executive. "We purchased systems, trained staff and established procedures... now they’re saying it may be changed. It’s a major letdown."

The Commission's Stance

A commission spokesperson supported the final law, saying: "The commission has responded to concerns and acted to ensure a simple, fair and cost-efficient implementation."

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