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Widely celebrated as a landmark law that would combat the worldwide crisis of forest loss.

But, the final version of the European Union's anti-deforestation law, previously touted as the crown jewel of the Green Deal, has emerged in a significantly diluted state, leading to alarm from its original architect and green lawmakers.

"The regulation was hollowed out," said Hugo Schally, citing the removal of key obligations for later-stage companies to verify the origin of products like coffee, cocoa, beef, soy, palm oil, rubber and timber.

He warned that a reduced number of responsible companies, 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 went further, describing the delays, loopholes and exemptions – including one for paper goods – as the "systematic weakening" of the law.

This outcome is a far cry from the hopes of more than a million European citizens who supported an initiative in 2020 demanding a prohibition of goods linked to forest destruction.

At its launch in 2021, then-Green Deal commissioner the European commissioner trumpeted it as "the most ambitious law proposed to fight deforestation."

From Ambition to Compromise

The law's unravelling has been interpreted as the European Union retreating from its environmental promises. The proposal encountered two major postponements, ostensibly over IT issues, which sparked criticism.

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

In its first draft, the regulation mandated that firms to track goods to their specific geographic origin using GPS coordinates, making them liable for forest loss along their supply lines with criminal charges and hefty fines.

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

Mounting Pressure

However, the strict due diligence provoked opposition in the EU capital from large companies, producer countries, conservative political groups and member states with forestry industries.

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

"Additional intense pressure has come from big trading partners like the United States," said expert Andreas Rasche, suggesting the commission gave in to some demands in trade talks.

Key Loopholes Introduced

In the final legislation features key dilutions:

• Retailers and traders were largely freed from submitting due diligence statements.
• A new exemption for small operators was created.
• A option for more reductions was established for next spring.
• Only four countries – Russia, Belarus, North Korea and Myanmar – will face the strictest monitoring.

"Rather than strengthening downstream obligations, it rolled them back," lamented Schally. "Moving obligations to producers, it lessened the number of responsible firms."

Business Frustration

The protracted process and revisions have also caused frustration for companies that prepared in advance.

"We feel very annoyed because we put a lot of effort into preparing," said Xavier Rombouts. "We purchased systems, trained staff and established procedures... now they’re saying it may be changed. It’s a big frustration."

Official Defense

An EU representative defended the outcome, saying: "The commission has responded to concerns and acted to ensure a pragmatic and balanced application."

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