The European Parliament has adopted its position on Omnibus I, approving significant reductions in the scope and ambition of the CSRD and CSDDD after the centrist coalition failed to reach an agreement. The EPP, backed by right-wing parties, pushed through the following changes:

CSRD

• Reporting would apply only to companies meeting both thresholds:
  ≥ 1,750 employees AND ≥ €450 million in revenue

CSDDD

• Mandatory climate transition plans deleted
• EU-wide civil liability is significantly limited

The file now moves to trilogue negotiations with the Council and Commission, both of which previously proposed more ambitious approaches. Whether the institutions can reach an agreement before year-end remains uncertain.

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The Council of the EU has adopted its position on the EUDR, supporting a 12-month postponement and several targeted simplifications.

However, nothing is final yet: The European Parliament will vote on 26 November to adopt its own position. Only after that can trilogue negotiations begin.

Key elements of the Council’s position:

• new application dates: 30 December 2026 (medium & large operators) / 30 June 2027 (micro & small operators)
• due diligence statements only for first-placer operators
• no separate DDS for downstream operators
• reference-number obligation limited to the first downstream operator
• simplified one-off declaration for micro-operators
• review clause by 30 April 2026

Until Parliament adopts its position and trilogues conclude, there remains a scenario in which the EUDR could still enter into force on 30 December 2025 in its current form.

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Germany’s Federal Office for Economic Affairs and Export Control (BAFA) has immediately stopped reviewing company reports under the Supply Chain Due Diligence Act (LkSG). The federal government has instructed BAFA to suspend its checks following a cabinet-approved amendment on 3 September 2025 that abolishes the reporting obligation and limits sanctions to “serious” or “particularly severe” human rights violations. This directive anticipates the new law, expected to take effect in early 2026. Companies can no longer submit LkSG reports via BAFA’s portal.

More information: BAFA.

The European Commission has published the first provisional CBAM benchmarks for 2026–2030.

Key points:

• different benchmarks for 2026–27 2028–30
• separate values for standard emissions factors and verified actual emissions
• methodology varies by production technology
• country-specific defaults apply when no actual data is available
• values are broadly aligned with existing EU ETS benchmarks

For many companies, operationalisation remains challenging because upstream emissions and production-method data are often incomplete.

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The EU has published Delegated Regulation (EU) 2025/1416, extending several transition options for the first wave of CSRD reporters:

• large companies >750 employees: additional deferrals for E4, S2, S3, S4
• materiality assessment remains mandatory
• E1/E2/E3 reliefs extended into 2025 and 2026
• companies <750 employees: exemptions from Scope 3, total GHG emissions, and full S1 disclosures

Wave 1 companies will therefore not face a larger reporting scope in 2025–2026 than in their first CSRD reporting year.

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 A U.S. appeals court has issued an injunction pausing the implementation of California’s SB 261, the state’s climate risk disclosure law that would have required thousands of companies to report on climate-related financial risks. The injunction comes only weeks before the first mandated disclosures.

Important:
The court did not halt SB 253, the California law requiring companies to report their Scope 1, Scope 2, and Scope 3 greenhouse gas emissions.

This means:

• SB 261 → paused pending appeal
• SB 253 → remains in force, with reporting beginning: 
  • 2026 (Scope 1 & 2)
  • 2027 (Scope 3)

Companies must therefore continue preparing their emissions accounting and data systems despite uncertainty around the climate risk disclosure framework.

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