EU Anti-Deforestation Regulation Effectively 'Gutted' After Initial Fanfare

Originally hailed as a landmark regulation that would combat the worldwide crisis of deforestation.

But, the final version of the EU's anti-deforestation law, once touted as the crown jewel of the Green Deal, has been passed in a severely weakened state, leading to alarm from its initial author and green lawmakers.

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

He warned that fewer obligated actors, less information collected, and less precise origin data would make enforcement and prosecution more difficult.

Political Dismantling

Environmental MEP Marie Toussaint went further, labeling the postponements, exceptions and new loopholes – such as one for printed products – as the "political dismantling" of the law.

This outcome stands in stark contrast to the hopes of more than a million EU citizens who supported an initiative in 2020 demanding a prohibition of deforestation-linked products.

At its launch in 2021, then-Green Deal commissioner Frans Timmermans called it "the most ambitious law ever put forward to combat deforestation."

From Ambition to Compromise

The regulation's dilution is seen by critics as the European Union retreating from its environmental promises. The proposal encountered significant delays, reportedly 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 law mandated that firms to trace commodities to their exact plot of land using GPS coordinates, making them liable for forest loss along their supply lines with penalties and large financial penalties.

"It wasn't bureaucracy for its own sake," the former official said. "These rules were the tool that made the rules enforceable, established traceability, and stopped companies from hiding behind complex supply chains."

Intense Lobbying

However, the strict due diligence triggered a backlash in Brussels from large companies, exporting nations, rightwing parties and EU logging states.

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

"The other pressure has come from big trading partners outside the EU," noted expert Andreas Rasche, implying the commission gave in to some demands in trade talks.

Key Loopholes Introduced

The passed law includes several critical weakenings:

• Downstream operators were mostly exempted from submitting due diligence statements.
• A new “low risk” category was created.
• A window for further "simplifications" was opened for next spring.
• Only four countries – geopolitical adversaries of the EU – will face the strictest monitoring.

"Instead of tightening rules for companies, it rolled them back," said Schally. "Moving obligations to producers, it lessened the number of responsible firms."

Business Frustration

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

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

Official Defense

An EU representative defended the outcome, stating: "We have listened to feedback and acted to ensure a pragmatic and balanced application."

"The new text provides for predictability, which is key for business and national regulators to effectively enforce this vitally important law."