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Background
The EU Green Deal has been subject to ongoing negotiations and revisions. As part of this trend, several initiatives have been launched to revisit existing EU sustainability legislation, including the Corporate Sustainability Reporting Directive (CSRD), the Corporate Sustainability Due Diligence Directive (CSDDD), and the EU Taxonomy Regulation (EU Taxonomy).
Details of the Omnibus simplification Package
On 29 January 2025, the EU Commission introduced the Competitiveness Compass, a plan to streamline legislation and enhance European competitiveness. This plan includes the Omnibus Simplification Package, which aims to reduce reporting burdens for companies, particularly small and medium-sized enterprises (SMEs). The Commission's Work Programme for 2025, published on 12 February 2025, further emphasised the importance of simplifying the EU's sustainability regulatory environment.
On 26 February 2025, the EU Commission published two Omnibus packages, including legislative proposals on the postponement of reporting deadlines and reduction of scope of reporting companies. In this update, we will provide an overview of these recent developments regarding the Omnibus Simplification Package
First Omnibus: 'stop the clock' proposal
The first Omnibus focuses on postponing the reporting deadlines for the CSRD and postponing the entry into application and transposition of the CSDDD.
Second Omnibus: simplification of CSRD, CSDDD, and EU Taxonomy
The second Omnibus aims to reduce the burden of the CSRD, the EU Taxonomy and the CSDDD by at least 25%. This includes simplifying sustainable finance reporting and due diligence requirements to support the European Green Deal’s goals. The second Omnibus also encourages voluntary sustainability reporting, benefiting companies with strong sustainability profiles and those in transition.
What to expect next?
The EU Commission's proposed two Omnibus packages has sparked intense discussions. The two Omnibus packages will undergo the ordinary legislative procedure. The next step is for both the European Parliament and the Council of the EU to scrutinize and adopt their positions on the Omnibus proposals. After that, the "trilogue" negotiations will commence. This process generally takes around 17 months from proposal publication to final adoption. The EU Commission has expressed a desire for prompt adoption to ensure legal certainty; however, the thorough consideration by the co-legislators may result in delays, with the earliest possible adoption expected by the end of 2025.
Contact us
Our firm is closely monitoring developments in ESG and related legislation. We will update this document as necessary. Want to learn more? Please check our update below and feel free to contact one of our colleagues listed below:
