The European Commission has released two major regulations or legislation packages: Omnibus I and Omnibus II. The packages aim to reduce regulatory burdens, improve sustainability rules, and unlock more private and public investment opportunities. 

The country aims to achieve a 25% reduction in administrative burdens and at least 35% for small and medium enterprises by simplifying regulations requirements like CSRD, CSD, CBAM, EU Taxonomy, and more. 

The Omnibus I and II packages are expected to reduce reporting burdens for private market firms, impact investors, and asset managers, potentially freeing up resources for investment and strategic initiatives.

Let’s explore Omnibus packages in detail. 

About the Omnibus I and Omnibus II

Omnibus I and Omnibus II are two legislative packages recently launched by the EU to reduce administrative efforts for companies and improve compliance. The Omnibus I package focuses on simplifying additional financial reporting in sustainable finance, including CSRD, CS3D, and EU Taxonomy. On the other hand, Omnibus II is made to further align and simplify various EU sustainability regulations to address more complex issues. In the newest addition of both packages, the EU has revealed bold adjustments to reporting requirements. 

Regarding the updates, the President of the European Commission, Ursula von Der, mentioned, “Simplification promised, simplification delivered! We are presenting our first proposal for far-reaching simplification. EU companies will benefit from streamlined rules on sustainable finance reporting, sustainability due diligence, and taxonomy. This will make life easier for our businesses while ensuring we stay firmly on course toward our decarbonization goals. And more simplification is on the way.”

Key updates on the Corporate Sustainability Reporting Directive (CSRD)

The new updates by the legislative package significantly streamline CSRD for ease of compliance. It includes: 

• Removal of 80% of companies in the EU from the CSRD scope. Only large companies with 1000+ employees or €50 million turnover are required to report under this regulation.

• There has been a two-year delay in reporting deadlines, which means that companies that were required to report in 2026 or 2027 now have until 2029 to comply. 

• Changes to the Green Asset Ratio for banks. Now, banks can exclude exposures related to companies below the 1000-employee CSRD threshold. 

• Removal of sector-specific standards. 
• Simplification of Do No Significant Harm (DNSH) criteria, streamlining the pollution prevention reporting across sectors. 

Key updates on the Corporate Sustainability Due Diligence Directive (CSDDD)

CS3D, which requires businesses to monitor their supply chains for ESG risk, has also been revised. 

• Companies no longer need to conduct in-depth assessments of indirect suppliers unless their ESG risk is proven.
• The ESG impact reviews are only required every five years instead of annually. 

• The EU has removed EU-wide civil liability provisions, so the cases will now be handled under national laws. 
• The update has delayed the implementation of CS3D by one year. The new compliance date is July 2028, and the implementation guidelines will be published a year earlier to better prepare.

Simplification of EU Taxonomy

Reporting under EU Taxonomy is now voluntary for businesses with less than 1,000 employees. A financial materiality requirement was also introduced to concentrate reporting on important business areas and reporting templates were reduced by 70%.

Next steps

The Omnibus I and Omnibus II are not yet finalized and are under review by the European Parliament and Council. Public and stakeholder feedback on Taxonomy will be collected before the final implementation of the new rules.

While you’re here…

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