Omnibus negotiations: Parliament and Council developing positions

The European Parliament’s lead negotiator, Jörgen Warborn (SE), has published his draft report, laying out what he and his political group (EPP) thinks the Parliament’s negotiation position should be. The main points in the draft report are:

• To align the scope of the CSRD and the CSDDD by proposing a threshold of more than 3,000 employees and a net turnover of more than EUR 450 million.
• To limit the value chain reporting requirements of the CSRD, meaning that if necessary information about a company’s value chain is not available or incomplete, a company is allowed to explain the efforts made to obtain this information and the reasons why it could not be obtained.
• To remove the mandatory requirement as part of the CSDDD to have a climate transition plan.
• To ensure that member states do not individually introduce more stringent sustainability due diligence requirements for specific areas such as emerging risks linked to new products or services.
• To limit CSDDD information requests by introducing that seeking information from direct business partners is only possible under certain conditions, and that in general companies should rely only on information that is already reasonably available (public, known from previous collaboration etc.).
• To require the European Commission to adopt a delegated act to provide for limited assurance standards in relation to CSRD by 1 October 2026.

On the Council side, a fourth compromise text (attempt to agree on a common position among the 27 member states) was published on the 12 June. The current compromise includes:

• Keeping the proposed scope of companies with more than 1,000 employees and either a net turnover of EUR 50 million or a balance sheet total above EUR 25 million.
• Keeping the CSDDD requirement of having a climate transition plan
• For CSDDD a full risk-based approach with certain limits is proposed. Companies are allowed to gradually assess risk areas in their in-depth assessment i.e. start with the most severe risks and over time include less severe risks. The initial scoping can only rest on information that is reasonably available to the company.

What happens next?

In the Parliament, the other members of the JURI committee can now propose amendments. These will then be negotiated and the final position will be approved in a plenary sitting. Seeing that amendments can be proposed until the end of June, the position could be approved in the plenary session held in the second week of July. The next plenary session after that is held in the second week of September.
The Council is likely to finalise their position by the end of June as this is when the Polish presidency ends. If not, the Danish presidency will take over the negotiations.