Omnibus package stop-the-clock proposal adopted by European Parliament

These are the Corporate Sustainability Reporting Directive (CSRD), the Corporate Sustainability Due Diligence Directive (CSDDD), and the Taxonomy Regulations. The overall goal of the Omnibus is to reduce reporting burdens, particularly for smaller and mid-sized entities, and increase efficiency in sustainability reporting. This comes as a result of pressure to foster a growth environment in the EU.

In an effort to provide clarity to affected entities, the European Council (EC) has accelerated the approval process for the portion of the Omnibus impacting the reporting timeline - referred to as the ‘stop-the-clock' directive. On 3 April 2025, the European Parliament adopted the stop-the-clock portion of the proposal. To enter into force, the draft law now requires formal approval by the Council of the European Union, followed by transposition by each member state. 

Stop-the-clock directive key dates

The stop-the-clock proposal will postpone:

• the CSRD requirements for large entities that have not yet started reporting, as well as SMEs, by two years (from fiscal 2025 to 2027 and 2026 to 2028 depending on original application date), and
• the transposition deadline and first phase of application of the CSDDD by one year (from July 2027 to July 2028).

It is important to note that the adopted CSRD postponement measure specifically does not mention Wave 1 or non-EU reporters, and as such, the relief does not currently extend to those entities. The CSDDD postponement does apply to Wave 1 reporters. 

Our thoughts

We are pleased that a clear timeline for CSRD and CSDDD application has been approved. With these changes in place, the European Parliament and EC will have time to agree on the additional substantial changes to the CSRD, Taxonomy, and CSDDD as set out in the Omnibus package. Additionally, this will provide entities with some relief as they wait to see whether the remainder of the Omnibus is passed.

Read the full European Parliament press release. 

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