Overview
- The European Commission proposed amendments to the deforestation regulation that shift due‑diligence reporting to the first EU importer, simplify requirements for very small firms, and introduce staggered enforcement with a six‑month grace period for larger companies and 12 months for micro and small businesses.
- The law targets products tied to forest conversion after 2020, covering cocoa, coffee, palm oil, soy, rubber, beef and timber, and the proposed changes would significantly reduce the number of companies subject to immediate reporting.
- The European Parliament rejected a negotiated dilution of the corporate supply‑chain directive in a 318–309 vote with 34 abstentions, postponing talks with EU governments until a re‑vote in November.
- The failed compromise would have raised coverage thresholds to roughly 5,000 employees and €1.5 billion in turnover and removed EU‑level civil liability for breaches, a plan backed by conservatives and industry but opposed by Greens and NGOs.
- Political pressure to deregulate intensified as Chancellor Friedrich Merz called the Parliament’s move a “fatal” error, regional and national ministers pushed for “zero‑risk” country exemptions, and the Commission warned such carve‑outs may clash with WTO rules, with negotiators still targeting year‑end deals.