EU Deforestation Law Largely 'Gutted' After High Hopes

Widely celebrated as a pioneering piece of legislation that would help stop the worldwide crisis of deforestation.

But, the final version of the European Union's deforestation regulation, once heralded as the crown jewel of the European Green Deal, has emerged in a severely weakened state, leading to criticism from its initial author and green lawmakers.

"The regulation was hollowed out," said the law's original author, citing 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 fewer obligated actors, fewer data points, and less precise origin data would hinder monitoring and legal action.

A Watered-Down Law

Environmental vice-president a leading green politician went further, labeling the delays, loopholes and exemptions – including one for paper goods – as the "systematic weakening" of the law.

This final text is a far cry from the hopes of over 1.2 million European citizens who supported an initiative in 2020 demanding a ban on deforestation-linked products.

When launched in 2021, the EU's climate chief the European commissioner called it "the most ambitious legislation ever put forward to fight deforestation."

A Story of Dilution

The regulation's dilution has been interpreted as the European Union retreating from its green talk. It faced significant delays, reportedly over IT issues, which sparked criticism.

"By reopening this file instead of solving a technical issue, authorities invited political interference," remarked the Green MEP.

In its first draft, the regulation required companies to track goods to their exact plot of land using geolocation data, 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 ensured enforcement, established traceability, and stopped companies from hiding behind opaque production networks."

Mounting Pressure

However, the rigorous checks triggered a backlash in the EU capital from large companies, producer countries, conservative political groups and EU logging states.

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

"The other pressure has come from major export markets like the United States," said expert Andreas Rasche, implying the EU yielded to some demands in trade talks.

Key Loopholes Introduced

The passed law features key dilutions:

• Retailers and traders were largely freed from submitting due diligence statements.
• A new exemption for small operators was introduced.
• A option for more reductions was opened 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 lessened the number of responsible firms."

Uncertainty for Companies

The delays and changes have also caused frustration for companies that prepared in advance.

"We feel very annoyed because we put a lot of effort into preparing," stated Xavier Rombouts. "We invested in software, followed seminars and built a team... now they’re saying it could be altered again. It’s a major letdown."

The Commission's Stance

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