Omnibus law I has just been definitively adopted by the Council of the EU and the European Parliament. It will be published before the end of 2025 in the Official Journal and will have direct consequences for companies that were affected by the reporting directive (CSRD) and the due diligence directive (CSDDD), as well as for the protection of human rights and the environment: this includes climate transition plans and civil liability. Reclaim Finance reviews the modifications brought by Omnibus law I.
Omnibus law I largely amends the CSRD and CSDDD directives to significantly reduce their scope. This movement operates both by shrinking the scope of the texts and by erasing or reducing the related obligations.
Scope and application of the CSRD and CSDDD directives: drastic reduction and new postponement
One of the major changes is the amendment of the application thresholds of the directives.
| CSDDD | Before Omnibus | After Omnibus |
|---|---|---|
| European company | 1000 employees and 450 millions euros in turnover |
5000 employees and 1.5 billion euros in turnover |
| Non-European company present on the European market |
1000 employees and 450 million euros in turnover |
1.5 billion euros in turnover |
In the name of competitiveness for small and medium-sized enterprises, the CSDDD application threshold is multiplied by five regarding the minimum number of employees, and by three regarding turnover. Thus, the number of companies within the scope of the directive plummets from 15,000 to 20,000 according to the Commission, to only 1,000 in the European Union (including 145 French ones).
| CSRD | Before Omnibus | After Omnibus |
|---|---|---|
| EU and non-EU companies | Two of the three conditions: 250 employees, 50 million euros in turnover, 25 million euros in balance sheet |
1000 employees, 450 million euros in turnover |
Similarly to the CSDDD, the drastic increase in the thresholds used for the CSRD reduces the number of companies required to provide extra-financial information from about 50,000 originally to only about 10,000 companies. The information available on the application is a gross estimation due to the absence of an impact study from the European Commission, an absence that has moreover been the subject of formal complaints (1). The European legislators have also introduced exemptions for listed subsidiaries and financial holdings.
This reduction in the scope of application leads to very concrete problems. While the extra-financial reporting of the previous directive (NFRD) applied to all companies with more than 500 employees, some companies find themselves in a situation of uncertainty since the new thresholds exclude them from the new reporting requirements.
For both texts, a review clause has been added, indicating that the application thresholds are not final and may be amended in 2031.
Finally, the transposition deadline is once again postponed by one year, a few months after the adoption of the “stop-the-clock” text. From now on, the new obligations will only apply to companies starting in July 2029.
Reporting Directive (CSRD): less complete, less reliable, and less comparable information
The final text confirms the will to drastically reduce the information required from companies. Pending the delegated act, expected around June 2026 and which will remove a significant portion of the data points requested under the CSRD, other major elements of the directive have been amended by the Omnibus I law:
- Sector-specific data points (sector-specific ESRS), which were to be progressively introduced into companies’ reporting, are deleted.
- Companies’ reporting will be restricted by a Value Chain Cap, i.e., a company size threshold below which they will not be able to request communication of much relevant information for their own CSRD reporting. This amendment will particularly reduce the quantity and reliability of information for the many companies relying on subcontractors or having fragmented value chains. The threshold is set at 1000 employees, except in exceptional justified circumstances.
Due Diligence Directive (CSDDD): erasure of climate and weakening of sanctions
While the European Union is adopting fresh climate targets, the Omnibus law scraps the requirement for companies to adopt and roll out climate transition plans. This is a major incoherence, as these plans were meant to ensure that companies integrate climate issues and adapt their business models accordingly.
The law likewise abolishes the EU-wide harmonized civil liability framework. This means 27 distinct liability regimes will emerge, in direct opposition to the notion of “simplification” sought by the European Union. Member States could race to the bottom with the laxest rules to draw in businesses, although the final Omnibus text includes a review clause for potential tweaks if required.
Beyond the provisions listed above, many elements of the Omnibus law affecting the preservation of human, social, and environmental rights have been adopted by European legislators without taking into account scientific work, economic data, or listening to the many voices of civil society (NGOs, unions, citizens, etc.). The European Union is no longer on the right track to achieve its climate objectives.
As long as private economic interests are preferred to the interests of all, the European Union will not be able to achieve its climate objectives. To get back on the right track, the European Union must now strengthen its regulation and compel companies operating on the European market to comply with the EU’s climate objectives.
