EU Deforestation Law Effectively 'Watered Down' After High Hopes

Originally hailed as a pioneering law that would combat the worldwide crisis of deforestation.

However, the revised version of the European Union's deforestation regulation, previously touted as the flagship policy of the European Green Deal, has emerged in a severely weakened state, leading to alarm from its initial author and green lawmakers.

"The regulation was gutted," said Hugo Schally, pointing to the removal of key obligations for downstream traders to check the provenance 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.

Political Dismantling

Environmental MEP a leading green politician went further, describing the delays, loopholes and exemptions – such as one for printed products – as the "systematic weakening" of the law.

This outcome is a far cry from the demands of over 1.2 million EU citizens who signed a petition in 2020 demanding a prohibition of deforestation-linked products.

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

A Story of Dilution

The regulation's dilution is seen by critics as the EU walking back its green talk. It faced two major postponements, reportedly over technical problems, which drew condemnation.

"By revisiting the legislation instead of solving a technical issue, the commission opened Pandora’s box," remarked the Green MEP.

In its first draft, the law required companies to trace goods back to their exact plot of land using GPS coordinates, making them liable for deforestation in their supply chains with criminal charges and hefty fines.

"It wasn't bureaucracy for its own sake," Schally said. "It was the mechanism that made the rules enforceable, established traceability, and prevented firms from obscuring their activities behind opaque production networks."

Mounting Pressure

However, the strict due diligence provoked opposition in the EU capital from large companies, producer countries, rightwing parties and EU logging states.

Analysts point to last year's EU elections as a decisive moment, creating a new political majority less favorable toward green regulations.

"Additional intense pressure came from major export markets outside the EU," said expert Andreas Rasche, implying the commission gave in to some requests during negotiations.

The Weakened Final Text

The passed law includes several critical weakenings:

• Retailers and traders were mostly exempted from conducting rigorous checks.
• A new “low risk” category was created.
• 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.

"Instead of tightening downstream obligations, it rolled them back," said Schally. "Moving obligations to producers, it reduced accountability."

Uncertainty for Companies

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

"We feel very annoyed because we put a lot of effort into complying," stated a coffee company executive. "We purchased systems, trained staff and established procedures... now they’re saying it could be altered again. It’s a major letdown."

Official Defense

An EU representative defended the outcome, stating: "The commission has responded to feedback and acted to ensure a simple, fair and cost-efficient application."

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