EU Deforestation Law Largely 'Gutted' After Initial Fanfare

It was a groundbreaking law that would help stop the global crisis of deforestation.

However, the final version of the European Union's anti-deforestation law, previously heralded as the crown jewel of the European Green Deal, has been passed in a significantly diluted state, leading to criticism from its initial author and environmental politicians.

"It has been stripped," said the law's original author, pointing to the exclusion of crucial requirements for downstream traders to check the origin of commodities like palm oil, soy, wood, beef, rubber, cocoa and coffee.

Schally cautioned that fewer obligated actors, less information collected, and imprecise sourcing details would hinder monitoring and legal action.

A Watered-Down Law

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

This outcome is a far cry from the demands of more than a million European citizens who supported an initiative in 2020 calling for a ban on deforestation-linked products.

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

A Story of Dilution

The regulation's dilution has been interpreted as the EU walking back its environmental promises. The proposal encountered significant delays, ostensibly over technical problems, which drew condemnation.

"By reopening this file rather than fixing a simple IT problem, the commission opened Pandora’s box," remarked Toussaint.

Originally, the regulation mandated that firms to track goods back 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," Schally said. "These rules were the tool that made the rules enforceable, established traceability, and stopped companies from hiding behind complex supply chains."

Mounting Pressure

Yet, the strict due diligence provoked opposition in Brussels from large companies, producer countries, rightwing parties and member states with forestry industries.

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

"The other pressure came from big trading partners like the United States," said corporate sustainability professor, suggesting the EU yielded to some requests during negotiations.

Key Loopholes Introduced

In the final legislation includes several critical weakenings:

• Retailers and traders were mostly exempted 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 the strictest monitoring.

"Rather than strengthening rules for companies, it stripped them back," lamented Schally. "By shifting responsibilities 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.

"It is very frustrating because we invested significant resources into preparing," said 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 supported the final law, stating: "We have listened to concerns and taken action to ensure a pragmatic and balanced implementation."

"The revised regulation ensures stability, which is crucial for companies and competent authorities to effectively enforce this very important regulation."