EU eases sustainability rules for businesses

The Council of the European Union (EU Council) has formally approved the Omnibus I package, which seeks to simplify rules on sustainability reporting and mandatory corporate due diligence. The objective is to reduce bureaucracy and strengthen the Union’s competitiveness at a time of mounting geopolitical pressure.

The obligation to produce sustainability reports will now apply only to large companies with more than 1,000 employees and a turnover exceeding €450 million. For due diligence, the threshold is higher still – 5,000 employees and a turnover of €1.5 billion.

Smaller businesses are thus intended to be shielded from excessive administrative burdens. At the same time, the requirement to draw up climate transition plans is being scrapped and a ceiling of 3 per cent of global turnover on penalties is being introduced.

According to the European Parliament, member states will have one year to transpose the directive, with the new rules for large companies due to take effect in July 2029. EU officials describe the move as a step towards a more flexible and realistic regulatory framework.

(pir)