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It was a landmark law that would help stop the global scourge of forest loss.

But, the revised version of the EU's anti-deforestation law, previously heralded as the flagship policy of the Green Deal, has been passed in a severely weakened state, leading to alarm from its initial author and green lawmakers.

"It has been stripped," stated Hugo Schally, pointing to the exclusion of crucial requirements for downstream traders to verify the origin of commodities like palm oil, soy, wood, beef, rubber, cocoa and coffee.

He warned that fewer obligated actors, fewer data points, and less precise origin data would complicate the task of authorities.

Political Dismantling

Green party MEP Marie Toussaint went further, describing the postponements, exceptions and new loopholes – including one for paper goods – as the "political dismantling" of the law.

This outcome is a far cry from the hopes of more than a million EU citizens who supported an initiative in 2020 calling for a prohibition of deforestation-linked products.

At its launch in 2021, the EU's climate chief Frans Timmermans called it "the most ambitious law proposed to fight forest loss."

From Ambition to Compromise

The law's unravelling has been interpreted as the EU walking back its green talk. It faced significant delays, reportedly over technical problems, which drew condemnation.

"By revisiting the legislation 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 goods to their exact plot of land using geolocation data, making them liable for deforestation in their supply chains with criminal charges and large financial penalties.

"This was not red tape for its own sake," Schally said. "These rules were the tool that made the rules enforceable, created a verifiable paper trail, and stopped companies from hiding behind opaque production networks."

Mounting Pressure

However, the rigorous checks triggered a backlash in Brussels from large companies, exporting nations, rightwing parties and member states with forestry industries.

Analysts point to last year's European Parliament elections as a decisive moment, shifting the balance of power more skeptical of environmental rules.

"The other pressure came from big trading partners outside the EU," said expert Andreas Rasche, implying the EU yielded to some requests during negotiations.

The Weakened Final Text

The passed law includes several critical weakenings:

• Downstream operators were largely freed from submitting due diligence statements.
• A new exemption for small operators was introduced.
• 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," lamented Schally. "By shifting responsibilities upstream, it lessened the number of responsible firms."

Uncertainty for Companies

The delays and changes have also created annoyance for businesses that complied early.

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

The Commission's Stance

A commission spokesperson supported the final law, stating: "We have listened to feedback and acted to ensure a pragmatic and balanced application."

"The revised regulation ensures stability, which is key for business and competent authorities to successfully implement this vitally important regulation."