EU green legislation: What to keep an eye on in 2026
A look at what’s expected from the Environmental Omnibus, EUDR, CBAM, and packaging and anti-greenwashing laws
There was a widespread sigh of relief when the EU’s first omnibus package was signed off in December.
While the redesign of the Corporate Sustainability Due Diligence Directive and Corporate Sustainability Reporting Directive has left a bad taste in the mouths of many companies, the final text has at least provided them with some clarity.
It doesn’t mean 2026 will be a quiet year for EU sustainability regulation, though.
“There will be a number of key areas for companies to watch out for,” says Joanne Holbrook, who co-leads the global environmental network at law firm Herbert Smith Freehills Kramer.
“Especially on packaging and deforestation.”
This coming August, for example, the Packaging and Packaging Waste Directive will be repealed to make way for an EU-wide regulation.
It will require almost all packaging placed on the EU market after 2030 to be reusable or recyclable, mandating certain levels of recycled content and corporate targets, and banning oversized packaging.
A consultation has just closed on future exemptions from the re-use part of the rules, but most aspects are already firmly in place and will start being phased in this year.
EUDR
Things are less clear when it comes to deforestation.
Last month, European lawmakers agreed to delay the EU Deforestation Regulation (EUDR) by another year, meaning it didn’t come into force at the end of 2025, as planned.
“The application of core obligations has been delayed by 12 months, with large operators and traders applying from December 30th 2026, and micro and small entities from 30th June 2027,” explains Matteo Squeo, a sustainability lawyer and founder of the Green Clause newsletter.
As part of the update, the Commission will conduct a simplification review for EUDR by April.
“That means the framework could still change before companies even reach the new application dates,” Squeo points out, adding that there is “no clarity about what it will ultimately look like”.
Holbrook is hopeful that any changes will be manageable.
“In many respects, the biggest revisions have already happened for EUDR,” she thinks, pointing out that there were opportunities to introduce drastic cuts to the regulation during renegotiations in 2024 and 2025, and it didn’t happen.
“So, although even more changes are expected after the Spring, all the new simplification efforts will in all likelihood be aimed at the administrative side of EUDR, not the fundamental parts.”
Environmental Omnibus
The same is in store for the Environmental Omnibus, she believes.
The eighth of the Commission’s 10 proposed omnibus packages, the Environmental Omnibus seeks to make coordinated changes to existing laws covering industrial emissions, the circular economy, environmental assessments and geospatial data.
“I don’t see the Environmental Omnibus as being as disruptive as the Omnibus I package, because the underlying obligations, which need a good amount of effort to comply with, still remain,” says Holbrook.
The aggressive deregulation of the past two years has made Squeo less sure, though.
“Based on developments on the other omnibus packages, especially Omnibus I, there are likely to be significant changes to the Environmental Omnibus proposal as it goes through negotiations this year,” he predicts.
CBAM
One of the EU’s more successful simplification efforts so far has been its revision of the Carbon Border Adjustment Mechanism (CBAM).
About 90% of importers were removed from the scope of CBAM as part of a redesign last year, but the Commission claims 99% of embedded emissions are still covered by the regime.
The rules came into force on January 1st, meaning many companies must now declare the embedded emissions of their imports and surrender allowances to compensate for them.
Those without precise, third party-verified data will have estimated ‘default values’ applied to their products, which are likely err on the higher side.
“This year will be a year of operational fine-tuning for CBAM,” says Madeleine Lofchy, an associate at London-based law firm CMS.
“We’ll see how the rules bed down in terms of business’ use of actual verified emissions data as opposed to default values and methodologies for calculating and reporting the emissions of products covered by the rules.”
The Commission may make further revisions in response to the outcome of that process, she notes, but the biggest change in 2026 will be to CBAM’s scope.
In December, policymakers proposed extending CBAM over the next two years to cover 180 steel- and aluminium-intensive downstream products – everything from car parts and white goods, to heavy machinery and industrial radiators.
“We’re likely to see the finalisation of some of that scope expansion in 2026,” predicts Lofchy.
Anti-greenwashing
And then there’s the Green Claims Directive.
The Commission has been tight-lipped about the future of the proposed anti-greenwashing law, which it controversially suspended last summer.
Whether it will be revived at some point, under pressure from co-legislators, remains to be seen. But in the meantime, companies will be preparing for the Empowering Consumers for the Green Transition Directive (ECGT).
Member States have until March 27th to transpose the directive, which bans generic green and ‘climate neutral’ claims, into national law. Six months later, in September, the rules will come into force.
“So regardless of what happens with the Green Claims Directive, there will be some strengthening around the environmental claims that companies can make starting this year,” says Squeo.