EU Omnibus Regulation
The European Commission's legislative package of February 2025 that bundles, simplifies and postpones the sustainability obligations under the CSRD, CSDDD and the EU Taxonomy.
The EU Omnibus Regulation refers to the simplification package presented by the European Commission on 26 February 2025, which amends several sustainability frameworks at once. At its core it touches the Corporate Sustainability Reporting Directive (CSRD), the Corporate Sustainability Due Diligence Directive (CSDDD) and the EU Taxonomy. The package aims to bundle and streamline the reporting and due diligence obligations of European companies and to strengthen competitiveness, without abandoning the underlying goals of the European Green Deal. The term "omnibus" denotes a collective piece of legislation that combines several legal acts into a single proposal.
The package consists of several components. A so-called "stop-the-clock" directive (Directive (EU) 2025/794) postpones the application dates: companies in the second CSRD wave (large undertakings that were not yet subject to reporting) will report only for financial year 2027 instead of 2025, and listed SMEs only for 2028. In parallel, the transposition deadline of the CSDDD was deferred. A second, substantive directive is intended to narrow the scope of the CSRD considerably by raising the thresholds, so that only companies with more than 1,000 employees are expected to remain subject to reporting. In addition, the number of ESRS data points is to be reduced, value-chain obligations are to be limited, and the planned move to reasonable assurance is to be dropped.
For compliance officers the legal status is decisive: the "stop-the-clock" postponement was already adopted in 2025 and is binding, whereas the substantive simplifications concerning scope, the ESRS and due diligence were, at the time this entry was written, still being negotiated between the European Parliament and the Council in the ordinary legislative procedure and may change. Despite the relief, companies should therefore continue to build up their data collection and governance processes, because a later reporting obligation remains likely under applicable law and national transpositions may differ.
Legal Basis
COM(2025) 81 / COM(2025) 80 (Omnibus I proposals); Directive (EU) 2025/794 ("stop-the-clock"); amending Directive (EU) 2022/2464 (CSRD), Directive (EU) 2024/1760 (CSDDD), Regulation (EU) 2020/852 (EU Taxonomy)
Practical Example
A non-listed industrial company with 800 employees had prepared for its first CSRD report for financial year 2025. After the "stop-the-clock" directive enters into force, the compliance officer establishes that the first application date shifts to financial year 2027 and that, if the raised threshold of 1,000 employees is adopted, the company with 800 employees might fall out of scope entirely. The officer documents the revised timeline, informs management about the uncertainty of the ongoing procedure, and decides to continue the double materiality assessment already begun, in order to keep meeting investor and customer expectations on a voluntary basis.