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Widely celebrated as a landmark piece of legislation that would combat the worldwide scourge of deforestation.

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

"It has been hollowed out," said Hugo Schally, pointing to the removal of crucial requirements for downstream traders to check the provenance of products like palm oil, soy, wood, beef, rubber, cocoa and coffee.

Schally cautioned that a reduced number of responsible companies, fewer data points, and imprecise sourcing details would complicate the task of authorities.

Political Dismantling

Green party MEP Marie Toussaint was more blunt, describing the delays, loopholes and exemptions – including one for paper goods – as the "political dismantling" of the law.

This final text stands in stark contrast to the hopes of over 1.2 million European citizens who supported an initiative in 2020 calling for a prohibition of deforestation-linked products.

At its launch in 2021, then-Green Deal commissioner the European commissioner called it "the toughest legislation proposed to combat forest loss."

From Ambition to Compromise

The law's unravelling is seen by critics as the EU walking back its green talk. The proposal encountered significant delays, ostensibly over IT issues, which drew condemnation.

"By revisiting the legislation rather than fixing a simple IT problem, the commission opened Pandora’s box," commented the Green MEP.

Originally, the law required companies to track commodities back to their exact plot of land using geolocation data, making them liable for deforestation in their supply chains with penalties and hefty fines.

"This was not red tape 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."

Mounting Pressure

Yet, the strict due diligence triggered a backlash in the EU capital from multinational corporations, producer countries, rightwing parties and EU logging states.

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 major export markets like the United States," said corporate sustainability professor, suggesting the EU yielded to some requests during negotiations.

The Weakened Final Text

In the final legislation features several critical weakenings:

• Downstream operators were mostly exempted from conducting rigorous checks.
• A new exemption for small operators was introduced.
• A window for further "simplifications" was opened for next spring.
• Only a handful of nations – Russia, Belarus, North Korea and Myanmar – will face the strictest monitoring.

"Rather than strengthening downstream obligations, it stripped them back," lamented the law's author. "By shifting responsibilities to producers, it lessened the number of responsible firms."

Uncertainty for Companies

The delays and changes have also caused frustration for businesses that complied early.

"We feel very annoyed because we invested significant resources into complying," said 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."

Official Defense

A commission spokesperson defended the outcome, saying: "We have listened to concerns and taken action to ensure a pragmatic and balanced application."

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