HAVET & VANHUFFEL – Association d’avocats
On 26 February 2025, the European Commission unveiled its Omnibus legislative package, aimed at easing and simplifying sustainability reporting requirements for European companies.
This Omnibus reform seeks to amend three key pieces of EU legislation: the CSRD (Corporate Sustainability Reporting Directive), the CSDDD (Corporate Sustainability Due Diligence Directive), and the Taxonomy Regulation. (To learn more about the proposed amendments to these directives and the regulation published by the Commission, read our article: https://earthlaw.network/fr/europe-the-european-commission-made-public-on-february-26-2025-its-draft-omnibus-directive-the-aim-of-which-is-to-simplify-the-eus-rules-on-sustainability-and-investments/).
On 23 June, the European Council published its negotiating mandate regarding the simplification of the CSRD and the CSDDD.
Member States proposed going even further than the European Commission:
-
regarding the CSRD, the Council sought to raise the threshold to 1,000 employees and a turnover above EUR 450 million (compared with the current EUR 50 million);
-
the Council proposed the introduction of a review clause concerning a potential extension of the scope;
-
regarding the CSDDD, it proposed raising the thresholds to companies with 5,000 employees and EUR 1.5 billion in net turnover;
-
finally, it proposed replacing the obligation to implement a transition plan for climate change mitigation with a provision “specifying that this transition plan includes the actions (taken or planned) to implement it.” (To learn more about the content of the European Council’s negotiating mandate, follow the link: https://www.consilium.europa.eu/fr/press/press-releases/2025/06/23/simplification-council-agrees-position-on-sustainability-reporting-and-due-diligence-requirements-to-boost-eu-competitiveness/.)
The European Parliament approved in plenary session on 13 November 2025 a reduction of the obligations related to sustainability reporting (CSRD) and due diligence (CSDDD). The negotiating mandate was adopted with 382 votes in favour, 249 against, and 13 abstentions.
-
Concerning the CSRD, only companies with an average of more than 1,750 employees and an annual turnover above EUR 450 million would be required to publish social and environmental information and to apply the EU Taxonomy (EUT).
-
Concerning the CSDDD, the requirements would apply only to companies with more than 5,000 employees and EUR 1.5 billion in turnover. Companies would have to adopt a risk-based approach to identify their negative impacts without systematically engaging their smaller partners. The obligation to establish a transition plan aligned with the Paris Agreement would be removed. Companies would be held liable for damages caused by breaches of due diligence obligations under national law, rather than at the EU level. The maximum fine for companies found in breach would remain 5% of their global turnover, and the Commission and EU Member States would have to provide guidance to national authorities on these sanctions.
The Parliament also wishes to create a free digital portal with templates and guidelines for all EU reporting obligations. (To learn more about the content of the European Parliament’s negotiating mandate, follow the link: https://www.europarl.europa.eu/news/fr/press-room/20251009IPR30836/durabilite-et-devoir-de-vigilance-des-regles-plus-simples.)
The next step in the procedure is negotiations between the Commission, the Council and the European Parliament in what is known as the Trilogue.