In late February 2025, the European Commission published the „Omnibus Simplification Package“. The goal of the proposal is to enhance competitiveness in the common European market while simultaneously upholding the goals set with the European Green Deal.
This goal is to be achieved through changes in the Corporate Sustainability Reporting Directive (the CSRD), the Corporate Sustainability Due Diligence Directive (the CS3D) as well as the draft of the Taxonomy Delegated Act.
Primarily, regarding the CSRD, reporting requirements are to be implemented only on undertakings with more than 1000 employees and a turnover of at least 50 million Euros or a balance sheet total of 25 million Euros. On the other hand, companies that have less than the stated number of employees are omitted from this obligation. However, it should be noted that SMEs can submit voluntary reports under a simplified standard. Finally, the reporting requirement itself is postponed for two years for undertakings required to comply from 2025 or 2026 onwards.
On the other hand, the transposition of due diligence obligations set by the CS3D has been pushed back to late July 2027, or 2028 for large undertakings. In addition, the scope of the due diligence obligation is limited by removing the in-depth assessment requirement for negative impacts of indirect business partners. Finally, in order to ensure level application across the European Union, maximum harmonization of main due-diligence provisions is required.
Regarding the draft EU Taxonomy Regulation, only the biggest undertakings regulated by CSRD must uphold reporting requirements, while others may do so on a voluntary basis. In addition, reporting templates will be simplified by being reduced by 70 %. Finally, in order to aid the transition towards sustainability, under the new proposal it will be possible to report activities partially aligned with the EU Taxonomy Regulation.
Prepared by,
Daniel Vujacic, LL.M. (UW)