The European Commission has adopted a new package of proposals to simplify EU rules, boost competitiveness and unlock additional investment capacity. This marks a significant effort in creating a more business-friendly environment to help EU companies grow, innovate, and create jobs.
This proposal aims at reducing administrative burdens by at least 25% and, for SMEs, by at least 35% by the end of the current mandate. Moreover, these Omnibus packages aim for simplification in the areas of sustainability reporting, corporate sustainability due diligence, EU taxonomy, Carbon Border Adjustment Mechanism (CBAM), and European investment programs. The proposals will reduce the complexity of EU requirements for all businesses, especially SMEs, while keeping the largest companies, which are likely to have the greatest impact on climate and the environment, at the center of the regulatory framework.
If adopted and implemented as outlined today, the proposals are estimated to save approximately €6,3 billion annually in administrative costs and mobilize additional €50 billion in public and private investment capacity to support political priorities.
The key changes and simplification actions occur in four main fields:
- Making sustainability reporting more accessible and efficient
Sustainability reporting obligations will be restricted only to larger companies (i.e., companies with more than 1.000 employees and a turnover of more than €50 million or a balance sheet of more than €25 million) and they will not create burdens for smaller businesses in their value chains. The reporting obligations for companies currently in scope of the CSRD and due to report in 2026 or 2027 will be postponed by two years.
- Simplifying due diligence obligations to support responsible business practices
This simplification will reduce the burden and negative impact on SMEs by limiting the amount of information that large companies may request during value chain mapping. Furthermore, the proposal aims at giving companies more time to prepare for compliance by postponing the application of sustainability due diligence obligations for the largest companies by one year, while moving forward the adoption of guidelines by one year.
- Simplifying the Carbon Border Adjustment Mechanism for fairer trade
Exempt small importers, mostly SMEs and individuals, from CBAM obligations. Indeed, these are importers of small quantities of CBAM goods, representing minimal embedded emissions entering the EU from third countries. A new annual cumulative CBAM threshold of 50 tons per importer will be introduced, removing obligations for about 90% of the total, while still covering around 99% of emissions.
- Unlocking investment opportunities
Increasing EU investment capacity by using returns from past investments and optimizing use of remaining funds under existing instruments. This is expected to mobilize about €50 billion in additional public and private investment. Simplifying administrative requirements for implementing partners, financial intermediaries, and final recipients, particularly SMEs. The proposed simplification measures are expected to generate cost savings of €350 million.
Documentation related to Omnibus package can be found here.
