This week’s EU Omnibus developments
A rundown of who is saying what this week, and what more we know about plans to revise Europe’s sustainability rules
The European Commission has been warned by lawyers and civil society that this week’s closed-door consultations on the omnibus could contravene EU law.
A letter from non-profit law firm Client Earth and more than 50 other NGOs noted that “the right to participate in EU decision-making processes is a democratic principle protected by EU law”.
Specifically, it continued, the law requires the Commission “to carry out broad consultations with parties concerned in order to ensure that the Union’s actions are coherent and transparent”.
According to the Better Regulation Guidelines, designed to help the Commission comply with those laws, it’s mandatory for any initiative that requires an impact assessment to also have a 12-week online consultation.
Impact assessments are required when a potential policy intervention has notable economic, environmental or social implications.
“This is evidently the case for the Omnibus,” the letter argues, adding that the Commission’s recent decision to host private ‘round-tables’ to discuss the package with invited representatives “blatantly fails to meet the standards of broad public consultation”.
Nonetheless, those roundtables took place on Wednesday and Thursday.
There are differing reports about how many people were in attendance, and who was represented, but analysis by one NGO claims that the 30 companies on the guestlist were from just five Member States: Spain, France, Germany, the Netherlands and Italy.
The US and the UK were also represented, according to SOMO.
There was the same proportion of guests (13%) from Oil & Gas as there was for SMEs.
Sources say the meeting saw many corporate participants ask the Commission to adopt the rules of the International Sustainability Standards Board (ISSB) instead of sticking with the more ambitious European Sustainability Reporting Standards.
If that push continues, it could see the EU drop its current expectation for companies to tell stakeholders how their business activities impact the environment and social issues, focusing instead solely on how the environment and social issues could impact their business.
It would also mean that only climate was covered for the initial phase of disclosures.
Klaus Hufschlag, DHL’s senior vice president for sustainability reporting, said on LinkedIn that his “key takeaways” from attending the Commission round table on Thursday included the need to “scrap EU Taxonomy”.
Hufschlag, who is on EFRAG’s sustainability reporting group, said “the complexity of [the] Do-No-Significant-Harm concept hinders the purpose to effectively assess sustainable investments”.
“It does not add value to investors, but is a burden for companies,” he added.
His post also cited a need to “streamline CSRD” by parking sector-specific standards and eliminating current digital tagging requirements, and taking “a more risk-based approach” to the CS3D.
Pro-business think tank the European Roundtable on Climate Change and Sustainable Transition published its own recommendations for the Omnibus on Friday, calling for CS3D to be paused, and CSRD to be simplified.
There are reports that the Commission is considering reducing the scope of CSRD to match that of CS3D, meaning it wouldn’t apply to firms with fewer than 1,000 employees.
It is widely understood that the Commission will delay the publication of the omnibus proposal until March, to allow more time for the details to be decided.
The Commission did not respond to requests for clarity about its plans.
In the meantime, on Wednesday, Commission president Ursula von der Leyen will present its 2025 work programme to European Parliament. MEPs will also discuss the Competitiveness Compass with the Commission and Council. Both sessions are expected to include further debate and information about the Omnibus.