‘Regulatory schizophrenia’: Division among MEPs in first omnibus debate

European Parliament’s first debate on the EU omnibus last night provided a glimpse into the fractious negotiations in store for MEPs on the proposals.  

There were impassioned speeches from both sides of the political spectrum during the two-hour session, highlighting the lack of consensus on what Parliament’s position should ultimately be.  

Lara Wolters, an MEP for the Dutch Labour Party, said the Commission “should be ashamed” of its plans to revise the Corporate Sustainability Reporting Directive (CSRD)  and the Corporate Sustainability Due Diligence Directive (CS3D).  

“This is regulatory schizophrenia that’s going to end up increasing compliance costs,” she warned her colleagues. 

“Companies have already invested in sustainability, and now the Commission is pulling the rug from underneath their feet.” 

Wolters noted that plans to prohibit large companies from requesting sustainability information from smaller ones would lead to inaccurate and incomplete reporting, and make it difficult to comply with the rules. 

Rasmus Andresen, a green MEP for Germany, called the omnibus proposals “a massacre” and said his party “hope[s] there will be changes during the legislative process”.

He urged fellow MEPs to pursue “better implementation” – including more transitional reliefs for CSRD and CS3D – instead of cuts.  

“We need a better distinction between big companies and small-scale enterprises, but what we have on the table has gone far beyond that, and so we’re extremely sceptical.” 

Marcin Sypniewski, a Polish MEP for the Europe of Sovereign Nations Group, led the call for greater reductions in the directives.   

“The problem is not that regulations are too complex, it’s simply a problem of volume,” he said, adding that Europe needed “a chainsaw, not a letter opener” to make adequate cuts.  

Sweden’s Charlie Weimers, from the European Conservatives and Reformists Group, described the Commission’s proposals as “a good first step” but suggested they should go further.

He said negotiations should prioritise small companies. However, multinationals – which a number of other right-leaning MEPs claimed were able to cope with sustainability regulation – should also be recognised as “good guys” and treated accordingly. 

The Big Question: Will the EPP side with the centre-left or the far-right?

The biggest tension in Parliament centres on whether the EPP – the umbrella group for centre-right MEPs, which broadly supports the omnibus proposals – will choose to find common ground with the far right, or with the centre-left. 

The EPP is the biggest group within Parliament, so it will dictate the direction of the negotiations, but it still needs a coalition to secure the necessary majority. 

This will probably involve negotiating with either with the Progressive Alliance of Socialists and Democrats (S&D) – the main centre-left group in Parliament – or with the far-right Europe of Sovereign Nations. 

One EPP member suggested in yesterday’s debate that the S&D is not prepared to come to the negotiating table with reasonable compromises, but the S&D accuses the EPP of simply not engaging with them.   

Asked if it planned to include the left in future conversations, EPP member Peter Liese said he had already spoken with some MEPs about the Carbon Border Adjustment Mechanism. 

“Of course, I will reach out to green colleagues and Renew colleagues,” he promised. 

“I think that on CBAM, we can find a broad majority representing the pro-European forces […] I hope that the greens and the S&D will be constructive when it comes to other issues, not just on CBAM.”