The Omnibus package proposal has been published

The 26 February 2025, the EU Commission has proposed drastic changes to the existing sustainability requirements in the Omnibus I and II packages.

The proposal from the Commission includes the following elements (Sustainability Omnibus Overview):

•  “A proposal for a Directive amending the CSRD and the CSDDD;
• A proposal which postpones the application of all reporting requirements in the CSRD for companies that are due to report in 2026 and 2027 (so-called wave 2 and 3 companies) and which postpones the transposition deadline and the first wave of application of the CSDDD by one year to 2028.
• A draft Delegated act amending the Taxonomy Disclosures and the Taxonomy Climate and Environmental Delegated Acts subject to public consultation.
• A proposal for a Regulation amending the Carbon Border Adjustment Mechanism Regulation.
• A proposal for a Regulation amending the InvestEu Regulation” .

More specifically, the following modifications are announced:

CSRD & ESRS

• The reporting requirements for European entities and groups would only apply to large undertakings that have more than 1000 employees and either a turnover above €50 million or a balance sheet above €25 million.
• The net turnover threshold for groups outside of the EU to be subject to the reporting requirements at the group level would be raised from €150 million generated in the Union to €450 million. The threshold for the EU branch under article 40a is raised from €40 million to €50 million and the threshold for the EU subsidiary is limited to large undertakings as defined in the Accounting Directive.
• This removes around 80% of companies from the scope of CSRD and instead aligns the thresholds for reporting to those of the CSDDD.
• The timeline of reporting is postponed by two years (until 2028) for companies currently in the 2nd wave (large entities) and 3rd wave (listed SMEs, small and non-complex credit institutions, and captive insurance and reinsurance undertakings).
• The value chain cap would be increased to all entities currently not in scope of the CSRD instead of only SMEs thereby limiting the trickle-down effect in the value chain.
• The double materiality concept, at the heart of the CSRD, is maintained.
• The first set of ESRS standards will be simplified, removing a number of mandatory datapoints & giving priority to quantitative information over qualitative.
• The sector-specific standards would be abandoned.
• The limited assurance on the sustainability reporting would not be converted in time to reasonable assurance. Considering this, there would only be targeted assurance guidelines provided by the EU Commission.
• For companies not subject to mandatory sustainability reporting requirements, the Commission proposes a proportionate standard for voluntary use which would be based on the VSME standard developed by EFRAG. According to this proposal, the Commission would adopt this voluntary standard as a delegated act. In the meantime, to address market demand, the Commission intends to issue a recommendation on voluntary sustainability reporting as soon as possible, based on the VSME standard developed by EFRAG.

EU Taxonomy

•  The reporting scope according to the EU Taxonomy will also be aligned to the scope of the CSDDD, therefore limiting the requirements to the largest entities.
• The proposal also introduces:
  • An “opt-in” regime in which large entities with more than 1000 employees and with a net turnover not exceeding €450 million which claim that their activities are aligned or partially aligned with the EU Taxonomy shall disclose their turnover and CapEx KPIs and may choose to disclose their OpEx KPI. For entities with more than 1000 employees and with a net turnover not exceeding €450 million that do not claim alignment to the EU Taxonomy, the reporting is not compulsory. In addition, this proposal provides more flexibility by allowing these entities to report on activities that meet certain Taxonomy technical screening criteria without meeting all of them.
  • A simplification of the reporting templates.
  • A financial materiality threshold for the Taxonomy reporting applicable for activities that do not exceed 10% of the total turnover, capital expenditure, or total assets of the company).
  • Simplifications to the most complex “Do no Significant harm” (DNSH) criteria for pollution prevention and control related to the use and presence of chemicals that apply horizontally to all economic sectors under the EU Taxonomy – as a first step in revising and simplifying all such DNSH criteria.

CSDDD

The Omnibus packages aim at implementing the following modifications to the CSDDD:

• The transposition deadline and first implementation of the directive are pushed back one year (to 2027 and 2028 respectively).
• The due diligence on the value chain is limited to Tier 1 business partners except if the company has plausible information suggesting that adverse impacts have arisen or may arise further in the value chain.
• Periodic assessment of negative impacts will need to be performed every 5 years instead of every year.
• Limiting the impact of the trickle-down effect by limiting the information that companies within scope may request from their SME and small midcap business partners (i.e. companies with not more than 500 employees) to the information specified in the CSRD voluntary sustainability reporting standards (VSME standard).
• Deferring to the various national civil liability regimes and removing the EU conditions for civil liability.
• Aligning the requirements on the adoption of transition plans for climate mitigation with the CSRD.

CBAM

The changes will exempt small importers from CBAM obligations, mostly SMEs and individuals. For those, measures to simplify the small occasional importations of CBAM goods, below the maximum threshold of 50 tons per year will be implemented. 
For those importers that remain in the CBAM scope, the proposed changes will facilitate compliance with the reporting requirements and aim at simplifying the authorisation of declarants, the calculation of emissions, reporting requirements and compliance with the financial liability.

At this point, Belgium has transposed the CSRD in the Company and Association code end of 2024. Until the new Omnibus draft is voted by the EU parliament and transposed into Belgian law, the initial requirements of the CSRD and of the EU Taxonomy continue to apply.