In March and April 2025, important decisions were taken at EU level concerning the implementation of sustainability and due diligence regulations (trade-e-bility reported on the so-called Omnibus1 package: Bureaucracy cutback coming?). Specifically, these concern measures to facilitate the Corporate Sustainability Reporting Directive (CSRD) and the Corporate Sustainability Due Diligence Directive (CSDDD). Here you will find a brief chronological sequence of recent events.
26 March 2025: EU Council supports "stop-the-clock" mechanism
As reported by the Council of the European Union, on 26 March 2025, the representatives of the EU member states agreed on a position on the so-called "stop-the-clock" mechanism. This mechanism aims to postpone the date of application of certain sustainability reporting requirements (CSRD) for large companies that have not yet started reporting and for listed SMEs by two years and to postpone due diligence obligations (CSDDD) of companies with regard to sustainability and the first phase of their application (which concerns the largest companies) by one year in order to strengthen the competitiveness of the EU and offer companies more legal certainty. According to the Council, a quick agreement between the two legislative bodies would allow more time to harmonise the content of the aforementioned directives.
1 April 2025: European Parliament votes in favour of fast-track procedure
On 1 April 2025, the European Parliament voted in favour of an accelerated procedure for dealing with the above-mentioned proposal by 427 votes in favour, 221 against and 14 abstentions. This fast-track procedure paved the way for a swift decision on postponing the application of these new regulations.
3 April 2025: European Parliament decides to postpone the new rules
On 3 April 2025, the European Parliament decided by 531 votes in favour, 69 against and 17 abstentions to postpone the application of the new EU rules on due diligence (CSDD) and sustainability reporting (CSRD). In concrete terms, this means
- CSDDD: “Member states will have an extra year – until 26 July 2027 – to transpose the rules into national legislation. The one-year extension will also apply to the first wave of businesses to be affected, namely: EU companies with over 5,000 employees and net turnover higher than €1.5 billion, and non-EU companies with a turnover above this threshold in the EU. These companies will only have to apply the rules from 2028. The date of application will be the same for the second wave of companies: those in the EU with over 3,000 employees and net turnover higher than €900 million, and non-EU companies with turnover above that threshold in the EU.”
- CSRD: “Application of the sustainability reporting directive will also be delayed by two years for the second and third waves of companies covered by the legislation. Large companies with more than 250 employees will be required to report on their social and environmental measures for the first time in 2028 for the previous financial year, while listed small and medium-sized enterprises will have to provide this information one year later.”
14 April 2025: Council gives final green light to ‘stop-the-clock’ mechanism
On 14 April 2025, the Council gave final green light to one of the Commission's proposals to simplify EU rules and thus boost the EU's competitiveness. This proposal (the so-called ‘stop-the-clock’ directive) defers the application deadlines for certain corporate sustainability reporting and due diligence requirements, as well as the transposition deadline for the due diligence provisions. The EU co-legislators therefore supported the Commission's proposal to
- postpone the entry into application of the CSRD for large companies that have not yet started reporting and for listed SMEs by two years and
- the transposition date and the first phase of application (for the largest companies) of the Corporate Sustainability Due Diligence Directive (CSDDD) by one year.
This swift agreement will buy time for the co-legislators to agree on substantial changes to the CSRD and CSDDD, which were also proposed by the Commission as part of the “Omnibus I” sustainability package.
Next steps: Once adopted, the legislation will be published in the EU Official Journal and will enter into force on the day following that publication. Member States will have to transpose this directive into national law by 31 December 2025.
The trade-e-bility consulting team will be happy to answer your questions on +49/40/750687-300 or sales@trade-e-bility.de.
