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Widely celebrated as a groundbreaking regulation that would help stop the worldwide scourge of forest loss.

But, the final version of the European Union's deforestation regulation, once touted as the crown jewel of the Green Deal, has emerged in a significantly diluted state, prompting alarm from its initial author and environmental politicians.

"The regulation was gutted," stated Hugo Schally, citing the removal of crucial requirements for later-stage companies to check the provenance of commodities like coffee, cocoa, beef, soy, palm oil, rubber and timber.

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

A Watered-Down Law

Environmental MEP a leading green politician went further, describing the postponements, exceptions and new loopholes – including one for printed products – as the "systematic weakening" of the law.

This final text stands in stark contrast to the hopes of over 1.2 million EU citizens who signed a petition in 2020 demanding a ban on goods linked to forest destruction.

At its launch in 2021, the EU's climate chief the European commissioner trumpeted it as "the toughest law ever put forward to fight forest loss."

A Story of Dilution

The regulation's dilution has been interpreted as the European Union retreating from its environmental promises. The proposal encountered significant delays, ostensibly over IT issues, which drew condemnation.

"By reopening this file instead of solving a simple IT problem, authorities invited political interference," remarked Toussaint.

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

"It wasn't bureaucracy for its own sake," the former official explained. "It was the mechanism that made the rules enforceable, created a verifiable paper trail, and prevented firms from obscuring their activities behind opaque production networks."

Intense Lobbying

Yet, the strict due diligence provoked opposition in the EU capital from large companies, exporting nations, conservative political groups and EU logging states.

Analysts point to last year's EU elections as a turning point, shifting the balance of power more skeptical of green regulations.

"Additional intense pressure has come from major export markets like the United States," noted corporate sustainability professor, implying 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 window for further "simplifications" was established for next spring.
• Only a handful of nations – Russia, Belarus, North Korea and Myanmar – will face “high risk” scrutiny.

"Instead of tightening downstream obligations, it stripped them back," lamented the law's author. "By shifting responsibilities to producers, it reduced accountability."

Business Frustration

The protracted process and revisions have also created annoyance for businesses that complied early.

"We feel very annoyed because we invested significant resources into preparing," said a coffee company executive. "We purchased systems, trained staff and established procedures... now they’re saying it may be changed. It’s a big frustration."

The Commission's Stance

An EU representative supported the final law, stating: "We have listened to feedback and acted to ensure a simple, fair and cost-efficient application."

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