On 26 February 2025, the European Commission proposed the first Omnibus package, Omnibus I, aimed at helping EU companies meet their sustainability obligations by simplifying certain sustainability reporting legislation. The vote on 3 April 2025 approved the proposal’s “stop-the-clock” mechanism, making headlines across Europe as businesses and stakeholders look to understand the implications and how to implement the changes. "Stop-the-clock" refers to an immediate change in deadlines regarding certain directives within the scope of the omnibus.
Despite the simplifications, the core objectives of these regulations remain unchanged. They continue to apply to non-EU firms as well, ensuring that external companies also meet the EU’s sustainability standards.
In this article, we will break down the main changes which have been proposed, as well as those which have already been approved, such as the “stop-the-clock” mechanism. We will examine the changes – both proposed and those already adopted – and discuss how they impact businesses, as well as the next steps your company can take to stay ahead of the regulatory changes.
What is the EU Omnibus?
The Omnibus is a proposed regulation to simplify certain legislation within the EU in one package. The primary goal of this simplification is to enhance the competitiveness of EU companies, making it easier for them to comply with sustainability requirements and enabling them to better compete in global markets. This will help businesses make advancements in sustainability reporting by reducing administrative burdens.
Which legislations are affected by the Omnibus proposal?
The European Commission's Omnibus Simplification Package proposes updates and clarifications to key sustainability regulations, aiming to streamline requirements and ease administrative burdens. The following regulations are those impacted by the Omnibus changes:
- The Corporate Sustainability Reporting Directive (CSRD)
- The Corporate Sustainability Due Diligence Directive (CSDDD)
- The EU Taxonomy Regulation
- Corporate Border Adjustment Mechanism (CBAM)
What are the changes in Omnibus?
The vote on the “stop-the-clock” mechanism has approved certain proposals, while others still remain to be voted on. Here is a list of the rules that have already been accepted, as well as those that are still awaiting a vote.:
Omnibus rules approved: Key changes confirmed (as of July 2025)
Omnibus “stop-the-clock” mechanism
On 3 April 2025, the European Parliament approved the installation of the "stop-the-clock" mechanism affecting both the Corporate Sustainability Reporting Directive (CSRD) and the Corporate Sustainability Due Diligence Directive (CS3D). This mechanism delays certain reporting deadlines under CSRD by two years for specific groups of companies.
Wave 1: No Change to Deadlines
- Scope: Enterprises with over 500 employees already subject to the Non-Financial Reporting Directive (NFRD).
- Deadline: No change. Companies must submit their CSRD-compliant reports for the financial year 2024 in 2025, as originally scheduled.
Wave 2: Two-Year Delay
- Scope: Large non-listed companies and groups exceeding specific thresholds (e.g., 250+ employees or €40 million in net turnover).
- Previous Deadline: 2026 (reporting on financial year 2025).
- New Deadline: 2028. Companies now need to submit their reports on the financial year 2025 by 2028.
Wave 3: Two-Year Delay
- Scope: Small and medium-sized public interest companies.
- Previous Deadline: 2027 (reporting on financial year 2026).
- New Deadline: 2029. Reporting for the financial year 2026 is now due in 2029.
Wave 4: No Change for Non-EU Companies
- Scope: Non-EU companies operating in the EU market.
- Deadline: No change. These companies must submit their CSRD reports for the financial year 2028 in 2029.
CBAM accepted changes
As part of the Omnibus I package, the Council and European Parliament have reached a provisional deal to simplify the EU's Carbon Border Adjustment Mechanism (CBAM), aiming to reduce compliance costs and administrative burden - especially for SMEs - without weakening climate goals. The reform retains coverage of around 99% of embedded emissions in CBAM goods.
Key changes include a new 50-tonne annual import threshold per importer, replacing the previous exemption for low-value goods. This broader de minimis exemption is expected to relieve many small importers from CBAM obligations. The agreement also introduces streamlined processes for importer authorisation, data collection, emissions calculation and verification, liability estimation, and recognition of carbon costs paid in third countries. Rules on penalties, indirect customs representatives, and financing the central CBAM platform were also clarified.
The agreement now awaits formal approval by both the Council and the European Parliament, with final adoption expected by September 2025. Once adopted, the changes will become legally binding.
What happens next with the Omnibus?
The Omnibus stop-the-clock mechanism has been approved. However, the proposals regarding the changes to CSRD, CS3D, and Taxonomy have not yet been accepted. The European Parliament will not vote on these proposals until October 2025. Therefore, the original content of the legislation is applicable until then, meaning the scope and reporting requirements remain the same until the vote to change them has been approved.
Pending vote: Omnibus rules still under discussion
As part of the ongoing negotiations surrounding the EU Omnibus package, a set of proposed changes has been introduced that could significantly impact large businesses operating within the European Union. While these proposals are still under discussion and have not yet been finalised or voted on, their potential scope and implementation may still evolve. Below is a summary of the key proposed revisions across various legislative instruments affected by the Omnibus.
Corporate Sustainability Reporting Directive (CSRD)The scope of the CSRD may be revised to apply only to companies with more than 1,000 employees, a shift that would exempt a broader swathe of smaller entities. Alongside this, the European Commission has proposed simplifications to the European Sustainability Reporting Standards (ESRS), including changes to sector-specific ESG disclosures. These measures aim to reduce administrative burden while maintaining the integrity of reporting. Additionally, the value chain reporting requirements would be reinforced through a strengthened “value-chain cap,” potentially placing more emphasis on traceability within supply chains.
Corporate Sustainability Due Diligence Directive (CSDDD)Proposals under the Omnibus package suggest narrowing the due diligence obligations to direct business partners only, thereby limiting the scope of liability unless a company has plausible knowledge of adverse impacts further down the value chain. The penalty framework would also be adjusted: rather than establishing EU-wide civil liability provisions, enforcement would be delegated to national frameworks, allowing for greater flexibility at the member state level.
EU Taxonomy RegulationTo ensure consistency with the revised CSRD thresholds, application of the EU Taxonomy could be limited to companies with more than 1,000 employees. A new opt-in mechanism is also being proposed, giving companies greater discretion over participation. Importantly, the number of mandatory reporting templates would be significantly reduced by approximately 70% in an effort to streamline compliance requirements and focus on material disclosures.