The Council of the EU and the European Parliament have reached a provisional agreement on the Omnibus I package, revising EU rules on corporate sustainability reporting and due diligence with the stated objective of reducing administrative burden and limiting spillover effects on smaller companies.

For sustainability reporting under the Corporate Sustainability Reporting Directive (CSRD), the agreement significantly narrows the original scope. Only companies with more than 1,000 employees and a net turnover above €450 million will be covered, and listed SMEs are removed from the directive’s scope. These changes are intended to reduce direct reporting obligations on SMEs and indirect information requests from larger companies.

The agreement also introduces a review clause allowing for a possible future extension of the scope of both the CSRD and the Corporate Sustainability Due Diligence Directive (CS3D), indicating that the revised thresholds may be reassessed at a later stage.

To support compliance for companies remaining in scope and their business partners, the EU Commission will establish a digital portal providing access to templates and guidance on EU and national reporting requirements.

On due diligence, the scope of the CS3D was aligned between institutions and remains limited to very large companies. The obligation to adopt climate transition plans has been removed, and the EU-level harmonised liability regime has been dropped. Companies will remain subject to national liability rules, with potential fines capped at 3% of net worldwide turnover. Due diligence obligations will be based on reasonably available information, reducing the likelihood of extensive data requests cascading to SMEs in supply chains.

The agreement also postpones the CS3D transposition deadline to 26 July 2028, with companies required to comply from July 2029.

The agreement is provisional and subject to formal approval by both institutions.

Members are invited to contact EBI in case of any questions.